In every other region of game development other than FPSC, "decals" are known as sprites, so actually he's right about that. A sprite is an animated 2D object. In Mario Brothers, Mario was a sprite. In FPSC, most (but not all) of the decals are sprites.
You might want to check out
Exgen, available here at The Game Creators. You can use it to develop 2D sprites which can then be applied to your FPSC games as decals. But some of the decals, like the steam, use particle effects... Exgen won't be able to do that, unfortunately.
Chris Franklin, a fellow TGC member, moderates the
forums on my website. You could instant message him over my forums and he usually responds pretty quickly, he might be able to answer some of your questions about exgen if he has the time.
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