I tested the Material Combiner addon
in Blender to create a Texture Atlas, and the results are great.
Before, each player used 2–6 materials which caused many draw calls.
Now each player has only one material.
Benefits:
Greatly reduced draw calls.
Higher performance (my FPS went up by ~50 with 25 players).
Cleaner glTF/GLB files, easier to load in CGE.
In short: using a Texture Atlas = fewer materials = fewer draw calls = better performance.
@Michalis: maybe it would be useful to mention this tool (or texture atlas workflow in general) in the CGE optimization guide
, if nothing similar is already documented there.