My first successful MDD animation.
Of course you can animate a tree using the internal mesh deformation using a power fractal, but especially with an almost leafless tree it's almost impossible to avoid the deformation of the trunk and the bigger branches for example, since there are no leaves that could cover this.
First I made a swaying animation of the whole tree in 3ds max using the lowest part of it as pivot. Then I tried to select the smaller branches and twigs using a falloff selection and applied a subtle noise animation for some wobbling. No doubt, a windswept tree animation out of a special tree software looks way more natural, but to me it looks quite OK.
I'll write down my procedure again (out of 3ds Max) for anyone who wants to use an MDD file for animation:
First I exported the tree object as an OBJ. Important:
deactivate any optimizing in the OBJ export options (vertex, normals, texture coordinates), otherwise your object will be messed up.
Then I used a point cache modifier, recorded the animation and exported it as a pc2 file.
I used PC2MDD:
http://www.kstorm.org/index.php/20-pc2mdd to convert the pc2 file into an MDD file which you can load into TG. It's also possible to convert your OBJ into a TGO in Terragen first to make it smaller. It seems to have the exact same number of vertices like the OBJ to make the MDD file work.