So I noticed everyone's having this one specific issue with this tool, in which painting a hat will make a hat unbone mergeable with a ragdoll.

And I think I may have found the fix for this.

On the menu for the Hat Painter tool, there should be a checkbox called Bone Merger Compatability Mode. If this is left unchecked, you should be able to paint a hat and bone merge it properly.

Hopefully this helps some (Like me) who have been struggling to bonemerge painted hats. :P