The low fps could be related due to the big textures (512*512) - when you move away the fps will go up.
I think that´s because the mipmaps are displayed.

I get >200 to 130 fps - it depends on the posititon.
(amd 3400+ / 1024 Ram / geforce8600 / Vista)

Of course this is a heavy shader and every subset will render in its own pass.
It´s not optimized though.
With a good sene management and shader-LOD it should be usable.
We are currently running our own tests with bigger environments.
If you don´t like it, then don´t use it or make it better for us all.