Just when I thought I was losing touch with reality

. Everything checks out OK. Is the LOD setting for LOD on textures or LOD on models, or both ?
Not sure what your're trying to achieve with "AI only vehicles". With a soldier in a tank (for example) that was not in your squad I would get a black screen and "has to be same squad" message, but it was easy enough to boot them out and not really that much of a hassle in coop/sp to be honest. Would be a real shame to lose some vehicles in this way unless there's some greater plan in play ?
EDIT: Does anyone else have issue with Squad selection menu not showing after turning on "No LOD's" ? Only the menu camera view is visible but the actual menu never appears although I can hear some menu selection sounds. Using the PR starter util to clear the shader cache fixes it.