What goes on here?

[Seven]

Modified .dds files (your car part files) aren't necessarily cheats. They just alter a car's looks by adding, for example a wing, extra spoilers, etc which can be an issue if you hit someone on track while using your modified DDS files as an extended bumper for example confuses LFS into thinking "Wait, your bumper is longer, I must KILL whoever touches it!" and so it does. This isn't the story for window stickers for example, but it happens with bodykits.

[Confession] I remember before I was in AA turning my XRG into another car completely then being a noob with no knowledge of LFS and trying to connect to a 4 slot drift server, second I joined the track with the car "CPW", 12 hour ban and that's how I learned about them

Some DDS files go undetected, like extending the wing on an XRR / XRT, to make it more "drift like" and stupid. I saw a guy post a screenshot showing off something funny on track, included in the picture was his car. He got a laugh at the thing that was funny, but also got a permban for potentially dangerous DDS modifications. Hence why most servers run a "Default dds only" thing where if you're caught with a body modification (excluding window stickers) you get a ban, varying in length. A lot of the time it falls under hacks / tweaks, because really it is. CPW is usually this, but also goes for other hacks.

That's my lecture for the morning.