Great discussion so far. I like the positive news about IceX 2.0. I might go with that based on the price alone... And the fact that it is made FOR Gamestudio doesn't hurt either.

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IceX2 is a fantastic tool. Freeworld 3d is another very good alternative.

Worldmachine and L3DT are good generators with very cool options to generate realistic looking terrains. They are a bit more complicated as IceX2 and Freeworld but are better generators. But they lack the interactivity that IceX2 and Freeworld 3D provide.

Terragen is an interesting generator and has superb rendering quality (for terrain and water, the clouds are bit simple). But the interactivity while deforming terrains is not very useful.

Vue5 can generate, export and deform terrains.

My favourites are IceX2 and Freeworld 3D.

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Thanks for the info Frank! Very nice breakdown.