I was having this same problem. I cleared my MO2 overwrite then looked for the texture that had been corrupted, found it and reinstalled that mod. DynDOLOD finished successfully after that. The texture that was screwed up for me was from a different texture pack, wont necessarily be from the Resources or the TexGen output. I think the issue had something to do with the process of updating my MO2 from 2.1.6 to 2.2.0 and not the actual version that I was using as reverting back to 2.1.6 didn't solve the problem
