I decided to open a topic for this area of modeling/texturing. At this moment I dont know practically anything about UV unwrapping, but during the course of learning this stuff, I'll write updates to this topic and hopefully at the end we have a nice tutorial for all the other people who are like me now, dont know nuttin'

Okay so I know something, I know that the UV thing (whatever the name stands for and the unwrapping... do I need to wrap it again then later heh) is the texture layout of my model flattened out from the 3D model shape into 2D texture.
Now, rolling up my sleeves and start learning, where is that google...
Basic Lithunwrap guide by Norsu:
1) Export model from O2 to 3DS format, untick all choices ja 100% size.
2) Open model in Lithunwrap and edit UV to your liking.
3) Save model to OBJ format, tick save coordinates.
4) Import OBJ to O2 and move model to proper location.
5) Then apply texture made for the UV into the model.
A rough guide to give some idea how UVs are done (lithunwrap method), thanks goes to Norsu. More coming later as information is gathered.