both. im guessing auto root has to do with playertypes or something?
i'm new to modeling which would explain my ignorance regarding both.
DTS stores (among other things) a set of nodes and a set of objects. My exporter "maps" DTS nodes to Blender armatures, and objects to meshes. Every DTS object has a parent node (which it is essentially attached to), and if you tried to load a DTS with an object that didn't have a parent node, the game would crash.
Blender lets you create a mesh without it being parented to an armature. When you do this, the exporter has the choice between telling you you can't do that, and just creating a placeholder node for you (which it in this case calls "__auto_root__"). Creating a placeholder node is almost always acceptable, and plenty of people model without parent armatures, so that's what it does.
When you want to work with DSQ files, the DTS nodes need to be in a specific order so the DSQ files can cross-reference them (some versions of TGE will search by name, but it doesn't seem like Blockland does, it only uses the ordering). This means that if you import a DTS file and you want the existing DSQ files to work with it after you export it again, it will need to put the nodes in the same order as they originally were. Thus, the DTS importer creates a text block in Blender called "NodeOrder", which is just a list of node names in the order they were found in the original DTS.
When the node order is specified, it means that you can't really export a node unless it's in the node order. This means that the exporter can't create "__auto_root__" for you. This means that importing a DTS and then adding a mesh that is not parented to an armature will not work. It's really pretty simple.