Alright, digging up this thread to contribute my experience so far with MH and Second Life. Sorry if I overlooked double suggestions:
Export Collada 1.4, Second Life rig:
Export as triangles, not quads (All avatar templates I have are working with triangles and the SL Model importer hangs on that in my -Firestorm- viewer, might be a BMesh issue?);
Export Bone weights (As far as I know, rigged avatars must be weighted);
Export with feet on position Z=0;
Optional: Choose export with Level Of Detail (LOD) 1(lowest),2,3,4(highest) in separate files;
And I'm not sure yet but the texture is not visible while preview in the SL Mesh model importer. (Might be the separate folder output or something I've overseen to check myself.)
However, I'm currently working on a new Reiko version (v3) that was exported as .obj from MH and imported into Blender (2.62), and using a rigged template from Machinimatrix.org (can provide the link to that particular template if needed.)
I rotated and relocated the body correctly, applied, rescaled as good as I could with the already weighted original template avatar visible - AND the already available rig and applied the scale.
I separated anything that can't be used (i.e. Teeth, etc) and moved that to a diff layer for (perhaps) later use. Then I converted the quad faces into triangles. I did not remove doubles in Blender this time because it removes some very important faces around the... erm.. nipples for example. It matches pretty good and I'm now copying the weights from the original. Alas, that takes loads of time.
I had to create 2 seams in my Reiko to subdivide it into head, upperbody and lowerbody for that first. All went perfect but this had to be done to copy the bone weights from the template (or it looks pretty weird and unsynched later while moving).
Now, I would like to suggest, if you can:
Add the bone weights during export to collada (1.4);
Export as triangles;
Export with the feet to Z=0 (and not the midpoint of the body) - the body itself X=0 and Y=0;
And optional, export in different LODs;
...and the whole Second Life community and all Mesh body creators will download your software and upload their creations.
There is probably still more to tweak but this could be a start to make this tool no.1 for creating perfect Mesh bodies in Second Life without using a second tool like Blender to tweak it further.
I'd be happy to help where I can. Unfortunately I'm a lousy programmer but can test this thoroughly if needed. I already have another idea to add during collada export (separated textured limbs) but since I still have to figure out how to apply that in Blender, it would be a bit too much to ask now. Would be a great option though.
Regards,
Bo