1) Make sure your AH1 terrain is not in the AH2 "ahiiterr" folder.
2) Start the terrain editor (TE).
3) Under "File", select the "Convert Terrain" button. Find and choose the *.oba file of the AH1 terrain you want converted.
4) Once the conversion is complete, you will have a new folder in the "ahiiterr" folder named whatever the terrain name was/is.
5) Now just open that OBA file.
6) First thing to do is to get the "ports" corrected. You will simply need to rotate them in place as they will not be facing the correct direction. Just do a "find" of the type "port0" to find them all. Select and rotate each one until done.
7) Next, under the "Terrains" tab, press the "Water not 0" button. This tests for water tiles that are not at 0 elevation. Fix any it finds.
8) Do a search for all the towns in the terrain. Make sure any town sharing the same vertex with a field is at the same elevation as the field. Also make sure there are no towns on top of fields. It can happen.
9) In the "Objects" tab, run the "Check Entry" button. This checks all vehicle spawn points for angle and collisions. As it finds bad ones, it will stop to allow you to move them. Fix all of them. Rerun this until they are all good.
10) Under the "Objects" tab, run the "Object Report". Run the "Check Terrain". Fix any problems.
11) Now go to the "Roads" tab and press the "Redo Objects" button. This might take a while. It is rebuilding all the roads/tracks/rivers for the terrain. Once it is done, you will need to check each road/track/river to make sure it is correct.
Side note: You really should use the "Create All" button here, as it will save you some grief. It simply lays all the roads and tracks to all the objects that require them. Then press the "Redo" button.
Note: You can press the "Redo" at anytime. Where you really must do it, would be after any terrain elevation changes, or any road changes (i.e. moving, deleting....).
12) Check the "Task Groups" tab and make sure any task group has a proper waypoint. Check to see there is a CV in each task group and it is the first ship in the list.
13) Under "Settings" from the main window menu bar, select "Field Setup". Press the "Standard" button. This will correctly assign planes, vehicles, ships and so on to all the fields. It will also setup the default zones.
It is rough, but it should get the terrain in good enough shape to be useable.