Min. size 0, skip 0 mipmap levels: fatal OutOfMemoryException error.
Min. size 150, skip 0 mipmap levels: fatal OutOfMemoryException error.
Min. size 0, skip 3 mipmap levels: success, 2 non-fatal warnings I mentioned above.
It seems that the workaround is setting "mipmap levels to skip" to something above zero.
BUT.
I remembered patching my morrowind.exe with http://www.ntcore.com/4gb_patch.php to avoid crashes in win7 x64. I decided to try the same patch on MGEXEgui.exe, and then regenerated DL three times in a row with my initial settings (min. size 0, skip 0) with NO errors whatsoever. That is, even the non-fatal warnings are now gone.
Hrnchamd, I surely hope this will be reproducible for you as well. I made sure not to change any other settings between tests.
If there is any more information I can give you, I'll be happy to help.