1. Check Exlist (vendors.uoex.net.) If you can buy a breedable animal of the type you want above level 30, do so. No more than one or two though unless they're low generation. Then breed the buys into your gen1's. You'll save a lot of time and gold.
2. Unless the animal is particularly hard to come by, your first breeds should be level 30. Except for rare spawns (e.g. nobles, mules) and non-spawning animals (ridable pack llamas that come only with new characters). Those you take what you can get. If you tame animals under level 30, ditch them and try another. Either way, when breeding up from gen1, wait until you have a couple animals whose level is at least in the high 20's.
This takes a lot of time, but it takes a lot less time and gold than breeding up from lower level pets.
3. Make a "training meat" pet. Tame songbirds until you get something high-level. Then have Meat attack another bird. He can't do any damage but he'll slowly level up. Let him keep training until he reaches 100 in wrestling/tactics/anatomy. Put his ability points into Physical resist and any leftovers into hitpoints. You want 75 phys and at least 70 hp. Keep taming fresh birds until you achieve this.
Your Training Meat is good for leveling particularly week gen1 pets. Ridable Pack Llamas die easily. Level them against Meat for a few generations until they have high enough resists and hit points for it to make sense to put points into damage and start taking them out to dungeons.
5. Physical resist first. Then poison/energy. Then cold/fire. Finally hit points to 100, then stamina to 100. Before you take them into dungeons, up the damage to 17/25. Do not put points into armor until you can't breed any more. Armor doesn't carry over to the children.
6. When you breed you get the average of the two animals. Rounded down. So put even numbers in everything. If you have an ability point left over, drop it in HP. If you always drop it in HP, sometimes you'll get two odds which add up even before averaging.
7. Every time you breed, some abilities get a random extra point or two. So, don't push your resists to max. Up them to 60 or so and then let them collect free points every breed. Until you reach gen 9. At gen 9 up the resists to 75 before backbreeding. Note this means you want your gen1's to have an odd number of points in each resist so that they add up even before averaging.
8. The number of extra points you get depends on your luck score and how far apart the two parents are. So, try to drop the points in different abilities for each parent. You won't get very many extra points either way, so don't sweat it if the two parents' abilities are close.
9. Luck impacts the number of levels gained. So, wear your best luck clothing before you breed.
10. Luck impacts whether you get male or female offspring. Change out luck clothing when claiming the children if you're getting too many male or too many female offspring.
11. Feed your pets before they breed. 7 days after their first feeding, the next character to feed them bonds them.
12. Feed yourself before you breed or claim offspring. Your fullness level seems to improve your luck. I think you're supposed to target full (not stuffed) but I don't know for sure.
13. Train the children in the training room before you take them into dungeons unless they happen to breed high wrestling/tactics/anatomy. This takes about an hour for non-casters and about two hours for casters. Don't train them in the training room if you're using the Training Meat approach above -- in that case you want to do the minimum damage to Meat lest you kill him and have to get another.
14. Your first objective with any breeding line is to reach level 42. Ignore their relative number of spent ability points for now; breed together the highest level male and female gen 8 or lower. If you don't reach level 42 in the first run up, backbreed the gen 9's into new level 30 gen 1's and keep trying.
15. Once the animals are capable of reaching level 43 or better you have to start being careful when you level them. Once they hit level 42, pull them out of the fight and shrink them. Level 43 and up can't breed.
16. Once you have level 42's, breed the ones whose spent ability points is about the same. Best bet is to create a spreadsheet of all the animals in your breeding line so you can easily identify which to breed.
17. When you reach gen9, backbreed into fresh gen1's. Then backbreed a gen9 into the resulting gen2 and gen3. This yields a gen4 at around 90% of what the gen9 had since you gain points from both averaging and leveling up.
18. Don't bother claiming the gen 10 from a gen 9 backbreed. Gen 10's can't breed and he'll have half the points of the gen9. Throw the gen 10 ticket into a trash bin. The tickets say which of the two animals they go with. You only have to spend the gold if you claim the animal.
Tips for the novice animal breeder
Re: Tips for the novice animal breeder
As a newish member and someone who is looking to try animal breeding, I wanted to say thank you for the guide!