All editing is done via Sproxel. We have a custom version (The code is the same as one of the official development versions, but I've included plugins that are useful to us) of Sproxel here: Click here to download Sproxel.
If for any reason you are interested in other Sproxel releases, you can find their site here.
The block must be 16x16x16, exported as .3mp, and not contain any compression.
If the alpha of a particular voxel is 254, that voxel will be material-colored. If the "red" hue of that voxel is 255, the material color will be vivid. If it is 254, less vivid, and so on down to 0 or black. If the green and black hues are both 0, then the material used be the primary block material. If the green and black hues are anything BUT 0, then they will be combined into an unsigned short int. (How?) This unsigned short int is the UID of the material they're made out of.
If the alpha of a voxel is 1, that voxel will be rendered 100% transparent. This is very framerate-efficient. If the alpha of a voxel is 0, it will not be rendered.
ScrumbleShip's hidden voxel determination is relatively simple, so any hollow spaces inside blocks will drastically reduce framerate.
Sproxel controls are unintuitive
Hold down alt, left click to rotate.
Hold down alt, right click to zoom.
Wazubaba has taken the time to create a short video tutorial for creating a component with Sproxel that can be found here.
For a reference guide to modifying components, see the Modding Components page.