How to prevent model from changing locations when going into dynamic topology mode? My character model rotates 90 degrees forward when I check dynamic topology. When exiting, the mesh goes back to it's original point with the exception of any vertices effected by sculpting, which remain 90 degrees forward.



After loading model.



After checking dynamic topology



After sculpting
When I load the .blend file, everything in the scene is selected.  

Click on the model name 'Game_engine' in the outliner,
so it selects all the pieces of the model, and it's pose.  

Click the skeleton icon in properties  

click Rest Position  

Alt-R to reset rotation.  

Hope that helps, if not, you might try Autodesk's tool
to convert it to a more recent .fbx file.
http://usa.autodesk.com/adsk/servlet/pc/item?siteID=123112&amp;id=22694909  

As a side-note:
The scene seems to have 2 lamps and 2 cameras with the exact same position.
You might delete the extra .001 for each of those, if they aren't needed.