Ah, I think I've figured it out.
MachNix (or anyone who knows), how large should the "square" in the center of the image be for Tile Setter? I took the color map outputted by Tile Setter and measured that the terrain seemed to be 550 pixels squared, so I adjusted the greyscale to that and got a decent result. Is there a set size that square should be on the 1024x1024 image?