When creating Blueprint Mods or PAK Mods, you may encounter an issue where custom materials do not display properly, instead showing as the default gray checkerboard pattern.
In fact, this is a very common issue, and people ask about it almost every month in the UE4 modding community. In some games, this issue cannot be resolved at all, but fortunately, R-Type Final 2 is not one of them.
As with the Animation Blueprint Update Event crash, the first step is to replace the configuration files in the project's Config folder with the game's default configuration files.
Next, go to Project Settings -> Packaging and uncheck Shared Material Shader Code.
If you only replace the configuration files without unchecking Shared Material Shader Code, the custom materials will still not display correctly.
If you only uncheck Shared Material Shader Code without replacing the configuration files, the game will crash after generating an Actor with custom materials.
If both are confirmed to be correct but custom materials still do not display, check if the Material and Material Instances are properly packaged into the correct PAK file.