Simply cannot export compatible models from Blender 2.74

[Spelos]

From the last screenshot it appears that you are most likely painting the texture on the model. That's purely Blender feature (as well as some other programs) and you would need to unwrap the model and apply the correct texture first.

It needs to be unwrapped... and UV textured.

See this tutorial for more information:
https://www.youtube.com/watch?v=Tovu1A0LxeQ

As far as the flip problem... you need to select the model (in OBJECT MODE) in blender and hit CTRL + A and then "Location", "Rotation" as well as "Scale"... you can pretty much click on all of them just to be sure. Then you export the model.

And For The Love of Christmas Spirit, please don't texture in .jpgs, sure it works, but .tga is small enough and supports transparency (alpha channel).

EDIT:
Also... It would work your way... But in blender your selected texture is grass.PNG and you have grass.JPG in your files... It's a totally different file if it's in another format.