Tutorial: How to reskin your portal gun.
Here's the error I get:
"The application has failed to start because its side-by-side configuration is incorrect. Please see the application event log or use the command line sxstrace.exe tool for more information".
And that was after I installed that thing Josepezdj said might work.
If you already installed that package and that error is popping up, that should be because you are on a x64-bits system, are you? If so, you'll need both packages, the x86 and the x64 installed in your computer for VTFEdit to work out.
You can also visit Nem's forums if it keeps failing 
useful tools and stuff here on TWP 
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[/spoiler]I tried that, and VTFEdit still won't open. Is there something I am missing?
Check for other versions of VS under "Programs and Features" on the control panel.
Might also be worth checking that you have the VS2008 and 2010 runtimes both installed.
I'm not sure which it uses, but here's a wee linkie:
http://answers.microsoft.com/en-us/wind ... 5e18e3f3ef
So, all 4 packages I guess. Chances are you'll have the 32 bit for at least one of them already as steam often installsupdates the VS runtimes when you get a new game, but those are normally 32bit.
I'd just grab all 4 to be sure 
FINALLY got it to work. Thanks for all your help!
How to reskin the portal gun for Atlas?
If you follow the tutorial, you'll see the required files.
Same process, but it will only show up for *you* during coop; the other person sees their own gun skins.
Is this why Portal 2 is taking forever to launch?
MLIA
Thanks in advance
That will probably be the audio cache being rebuilt if it's taking a *really* long time.
Wait for the orange dots to finish then close portal. It'll run like normal from now on, and it won't do that again unless you delete dlc3 folder, run portal, create new dlc folder and run portal again. (In that order)