Sometimes when importing models or levels into Max you will notice that the colors are washed out. This happens most when importing materials that use VTF files contained within a VPK file (available in 3ds Max 2015+).

The cause of this problem is that when WW opens a VTF file from a VPK, it then has to save the image to a TGA file in the MatGen folders. During this conversions, the gamma settings of the file are usually incorrect.

For games under development still, it's best to use Wall Worm Pro (which has native VTF support) and keep the VTF files on the filesystem and outside a VPK in the directories WW uses. That will avoid the washed out colors.

If you are getting this problem and do not have WW Pro or keeping the assets on the file system are not feasible, then the solution is to unpack the VTF files into your MatGen folder; for WW Pro, that is enough; for standard WW, you should also mass convert the VTF to TGA files in your MatGen folder.