The Livery Editor doesn't use .pak files; it uses its own .tsw2liv file format. .pak files are still useful if you want to completely replace the default livery/sound/posters/whatever with your new one, so that only the replacement appears. Livery-format files become random spawns, mixed up with the defaults and each other.
I tried for 3 hours to get this unpacking of .pak files until nearly 3am. I’ve installed everything I need to for TSWtoolkit, I’ve tried using the above video, but no matter what I try I cannot get any .pak to extract at all.