It pretty much boils down to quality vs performance. Yes, you can chose to have all of your textures as 32bit BMP files, but then you are probably going to have framerate issues at highly populated spots. I personally prefer having all textures as DXT3, purely on a performance background. I realise that the repaints take a quality loss, but then again, it's AI, I'm not supposed to be looking THAT close (note to repainters: Please don't take it the wrong way, I'd love to have all my repaints by 32 bit, but I just don't have the machine for it with my levels of AI)
I'm not sure if it's an imagined thing or not, but imagetool (apparently) tend to do a slightly more aggressive compression compared to DXTBmp. But if you're adding or removing mipmaps from textures that are already compressed to DXT3, you should use imagetool, as DXTBmp will re-compress the texture files leading to additional quality loss.