the steps are 8-bit artifacts.  if you can work in 16-bit, you'll have less of a problem, but even then I believe it'll want an extra tap on the smoothing button...  it's not Bryce's fault that you lose data when editing the terrain in an app other than Bryce.

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Check out my Elemental Hexagons deck, created with Photoshop, Bryce, MojoWorld, and Poser