Milkshape cost 25 dollars to register, the plug in for it is free.
Milkshape can not do LODs, or Break models though.
If you have PhotoShop you already have the big boy in the game, if not then PaintShop Pro will work great for around 60 bucks.
MilkShape for the editor itself
Plug-ins for the editor for SFC, and ShipEdit for SFC 2 editing the files made easy.
As for doing the models in SFC 3 good luck doing the arcs file and such is a pain in the ARSE