I need some advice on a Sega Saturn Emulator regarding "MDS and MDF" files.

Last I checked Blood Omnicide wasn't remotely finished and long-abandoned. Plus you still need the original game's data to use it. Also with some patches even original game works quite fine on modern OSes.

If I remember correctly, MDF/MDS is the proprietary image format of Daemon Tools. You'll probably have to load the files into DT's virtual drive and then start the game through the Sega Saturn Emulator as if it was an actual CD, which I presume the emulator is capable of doing.

The thing is I am trying to get this one game called Dark Savior:

https://www.youtube.com/watch?v=gpt5HbQp5HI

And now I have to install this Daemon Tools which sounds increadibly complicated and too much of a hassle?

Why could the files not be BIN and CUE files by default?

Was it Daemon? I'm recalling from memory so it might not be accurate, but I used Alcohol Tools for that.

Check again. Last blog was about a month ago or so.

The reason is probably that the person who ripped that game simply used Daemon Tools to do it, instead of something like IsoBuster. Daemon Tools is actually a fairly easy program to use and is capable of dealing with a variety of copy protection systems (at least I think it is), which made it a fairly popular choice.
Its downside is the fact that it can only create images as either .iso files, which are of course useless when dealing with CDs that feature redbook audio, or as its own proprietary MDF/MDS-format.

You may be able to convert it to BIN/CUE with IsoBuster, though.

EDIT: MDF/MDS is actually Alcohol 120%'s image format, but Daemon Tools can also read it.

Ah right, it is apparently Alcohol's format. I probably connected it to DT because that one is also capable of reading it, and I've never used Alcohol.
DT has the similarly named MDX format.

Oh yeah, indeed. And THAT'S why you should always have the development blog on the main page. :P