What is DDS?
DDS is DirectDraw Surface, the texture format games ship. Its point is that the GPU reads the compressed blocks directly, so BC1/BC3 textures never need unpacking at runtime. FileSorcery reads it and converts out; writing good block compression is a job for a dedicated compressor.
What is PBM?
PBM is Netpbm's bilevel format - one bit per pixel, pure black or pure white, nothing in between. It is used for scanned documents, fax-era imagery and dithered art, and its packing convention surprises people: a 1 bit means black.