So what happens when father's or mother's last name is already in FF FM form?

FF is your "first last name" and FM is your "second last name".

FF is your father first last name (his FF).

And FM is your mothers first last name (hers FF).

The FF FM order was how it used to be (at least in Chile). Now, when the first kid of a given couple is born, that couple choose the order (FF FM or FM FF). In any case, is always the first last name of the parents, and the chosen order must be used for all kids in common between them.