Spending a little time on the visualisation side of things at the moment. At right you can see the result of rendering the previous images as a height map. A simple colour map is applied based on elevation, and the terrain is lit.
The terrain is fairly low resolution, only 128×128 vertices, while the height map is 1024×1024 pixels. To increase the quality of the lighting, a normal map is generated from the height map, also at 1024×1024 pixels. This yields 8:1 vertex to texel ratio, giving very decent performance while still rendering at a high quality.
The terrain is actually split into 4 equal sized patches, 64×64 vertices each, in order to aid culling. At some point I will improve this system into an adaptive quadtree, which should provide far better performance.
I am rendering this all on an Intel integrated X3100 graphics processor, and so far I have been very impressed with the performance. Despite running commercial games extremely badly, this card seems to take no performance hit when using shaders instead of fixed function rendering, and in fact, the current shader-based normal mapping is faster than the previous fixed-function lighting.