Not really an "issue", but I found a workaround to fix the loading to have MMod working with the Anniversary Patch (reUpdate patch 2.0.0.2 as of writing - doesn't use the latest version of HL2 yet, but it should still apply the same).
- Make sure you have MMod installed, HL2:U installed and reUpdate applied.
- Go to "steamapps/common/Half Life 2 Update/hl2/" and edit gameinfo.txt file - I suggest to comment out the reUpdate lines in the file using "//". It should look something like this:

- Go to "steamapps/sourcemods/HL2MMod_HL2U/" and edit the game.info.txt file - you need to add the following lines to the file:
game+mod "|all_source_engine_paths|../Half-Life 2 Update/hl2/hl2_reupdate_fix.vpk"
game+mod "|all_source_engine_paths|../Half-Life 2 Update/hl2/hl2_reupdate_20th_textures.vpk"
You should likely add them near the "hl2_pak.vpk" slot.
It should look something like this:

- Launch the MMod version and you're good to go!
Unfortunately, as a side-effect, you will not be able to play the normal MMod-less version. if you want to go back to playing the standard version, follow Step 2 and instead of commenting the lines, just do the opposite, as they should be commented out if you did everything correctly.
Q: What happens if you don't comment out the lines in Step 2?
Well... The game rendering fully breaks. Most of the stuff is barely visible or rendered completely incorrectly.
Q: Can this possibly be automated, or can the rendering issues be fixed somehow?
No idea. I'm too inexperienced in Source Engine to answer the rendering question. As for automating - I assume this could be some sort of a "bonus fix" if anybody wants to use that.
Not really an "issue", but I found a workaround to fix the loading to have MMod working with the Anniversary Patch (reUpdate patch 2.0.0.2 as of writing - doesn't use the latest version of HL2 yet, but it should still apply the same).
game+mod "|all_source_engine_paths|../Half-Life 2 Update/hl2/hl2_reupdate_fix.vpk"game+mod "|all_source_engine_paths|../Half-Life 2 Update/hl2/hl2_reupdate_20th_textures.vpk"You should likely add them near the "hl2_pak.vpk" slot.
It should look something like this:
Unfortunately, as a side-effect, you will not be able to play the normal MMod-less version. if you want to go back to playing the standard version, follow Step 2 and instead of commenting the lines, just do the opposite, as they should be commented out if you did everything correctly.
Q: What happens if you don't comment out the lines in Step 2?
Well... The game rendering fully breaks. Most of the stuff is barely visible or rendered completely incorrectly.
Q: Can this possibly be automated, or can the rendering issues be fixed somehow?
No idea. I'm too inexperienced in Source Engine to answer the rendering question. As for automating - I assume this could be some sort of a "bonus fix" if anybody wants to use that.