New normal maps need to be in .tpc format, yes. The .txi is fed into tga2tpc along with the targa image, so the information contained inside it is indeed ‘baked’ into the .tpc for want of a better term.
You’re also correct in that where a bumpmap is applied, .txi files need to use bumpyshinytexture rather than envmaptexture if you want to incorporate a cubemap as well.
Correct on all above counts, in other words! I know Q has only recently started experimenting with normal maps for KotOR very recently and has been tackling some rather large texture packs, so I daresay any little niggling issues which slipped through will be addressed shortly. All part of the fun, as they say!