"Ironclad fully endorses the modding of its games for non-profit purposes. The Iron Engine is completely data-driven, has an embedded Lua Scripting Engine with console access, and is supported by the Forge Tool Suite. Modding instructions and the Forge Tool Suite will be provided."
Unfortunately the promise of the full Forge Tool Suite, which they developed to create the game is being delayed again. Supposedly until patch 1.1 rolls out, but since they are working on an Expansion Pack instead of living up to their advertisements, it is unlikely that we will get the full tools for quite some time, if at all. I can guarantee that I will not buy the expansion until I have the tools.
All we have right now is the Beta version of Galaxy Forge. The XSI conversion tool is no longer useful since they started providing the text versions of their files, instead of binary, for which I thank them. So it is not a suite, it is just the one tool.
Galaxy Forge is just for the basic setup of systems (planets, stars, jump lanes, starting ships, etc.). It will not allow any editing of stats for ships, races, research, or anything else that qualifies as modding to most of us.
You can find an excellent guide here that is a must read before using it:Galaxy Forge Guide
The full suite should have a graphical interface, so that you can easily see all the various parts of what you want to edit. So for example, if I wanted to edit one of the special abilities to create a new version, say a defensive lightening field, then it would show me the original file with all the files that it calls (uses). This way you would be sure to have all the files you need for your new ability. It would also limit each variable to a proper range, so that illegal settings could not be used, preventing crashing. If it was an excellent suite, it would even have pop-up descriptions of each variable, but that is pretty rare in tool suites.
Think of any webpage that you have registered on (like this one) with a combination of scroll boxes with values (e.g. Birthday Year), and text boxes (e.g. Name). It should also have a debugger to check the file for syntax errors.