The cloud editor allows you to create both cloud "layers" (like the kind at the default height of 15,000 feet), and cloud "banks" (the groups of puffy clouds). Layer types have a few types (thicknesses) and can be whatever alt you want. Puffy clouds have a few types and can have more/less "puffs" for each group. If saved with the source of the map, this cloud file will be the default for the terrain. If you provide a separate cloud file to be added to the terrain folder on the server, it will override any default clouds built into the terrain. At least that's my understanding.
With puffy clouds, you can also set the speed, direction, altitude, duration and respawn times. So, you can set up locally heavy clouds that move fast and die off after 100 miles, then respawn again 30 minutes after they die. Then you can have another set of clouds somewhere else that are few and slow-moving, that go on for 200 miles, and respawn immediately after they die.
There is a maximum number of "live" clouds that are allowed - mainly for playability - because it's a tax on CPU resources to track and render.