Yes, they did it with tools. I don't think they published the tools, but modders put out all kinds of tools to manipulate, edit, view, and otherwise work with them. I don't remember what they were called, but people had reverse engineered everything about their data.

There are a ton of WC3 editors and mods out there. Buildings and environmental objects can have multiple sets of geometry, as well as animation scripts, particle effects emitters, default idle animations and response animations, and more. They were regular 3D models that contained rigged bones just like characters. The animation sequences included animation events to show/hide geometry and trigger audio and do other script events.

Waterfalls, ghosts orbiting buildings, light beams, and similar linear effects used something they called “ribbon emitters”. Ribbons could follow paths, such as ghosts orbiting a necropolis. Other effects used more traditional particle emitters, like glowing fireflies or waterfall mist, or burning rocks and lava, where the emitter specifies what the particle is and the details of random/specified motion ranges, random/specified speeds, and other variables.