I've specially checked it in some part's .cfg, and all I can say is:
They are controlled by lines like:
lods 3 0.001 1.000 2.000
#render 0x???????? ; ???
#lod 0 0 // lo-res
render 0x000000E7 ; V6_oil_pan
lod 1 1 // hi-res
render 0x00000021 ; V6_oil_pan
lod 2 2 // extr-hi-res
lods line defines amount of LOD meshes, and next values are distances from the part to load another (lower or higher quality) mesh.
render line defines mesh that is written in .rpk file.
lod defines the order of LOD mesh. I don't know why there are two values.