Vraciu,
My first terrain BowlMA I free handed with only a rough sketch to guide me. I spent a month wandering blindly around that 4096x4096 work space trying to use only the CBM and the sector grid to guess at where to cut or raise up land from my not to scale sketch. Elevation was a joke against the vast scale of 1mile=8pixels on a 4096x4096 work space. Then I created a 4096x4096 map file and began editing it with guide points along with making a map file up to 10 times a day to look at tiny adjustments. I took one of the map files and turn that into a blueprint file project in paint.net. Things went a lot faster from that point since I was able to map all of the bases and strat objects to exact locations.
With a Melee arena terrain you need your blueprint file in as close to scale one way or another as you can get it. The grid squares in the terrain editor are 1x1 mile squares and that primary grid is 20x20 miles.
You saw on my screen clip from my art program the changes I was making to the terrain. I was able to generate a 4096x4096 map.bmp, then from my 4096x4096 blueprint file copy the changes into the map.bmp file. Then I put that map.bmp file into the texsrc folder and renamed it to oceania.bmp, the next time I opened the terrain editor, it was there to guide my adding the center island and cutting out those channels in the islands. I simply pulled the map to the locations indicated by the hash marks or the outline of the new island. I either made a -200ft 1mile diamter hole or a 500ft 1mile diameter column on the outline of the areas to be cut out or added to the terrain. Then I connected the dots.
That red square on the CBM in the terrain editor, the very center of it is your focus point on the terrain. If you push down onto an area of your terrain, then focus that red box centered on some line you want to follow and cut along or add along, you just punch a negative hole to create water dots or an elevation column, then connect dots along the line you want to cut away or add too. But, you need a blueprint to scale to transfer from or, print out a 4096x4096, edit it in an art program with your cut or add lines. Then use that as the CBM in the terrain editor to guide your work. And make one every time you make changes to see how it's going.
Here is the show stopper that can kink all of your work.
At some point you will have to either snip a copy of your CBM map in the terrain editor to a jpeg or use your blueprint file and post up a copy in here for Hitech to look at. With all the bases, strat and spawns. Like you do with the local zoning board to get the go ahead to build a new home. Even after that, when Hitech lets you FTP to him your project, he may have you change things you did not expect to change. In my case even before I did the FTP, he had me change all of the rock formations on my terrain from green rock to textured white dolomite. You've seen all that white rock on my terrain BowlMA, took me a week to visit and change the whole terrain by hand along with changes the new rock type needed in the terrain for the visual effects.
Before I built BowlMA, I built a gunnery training terrain called gunnery that you can get a copy of in the custom arena tab. By building that small 9x16mile single island terrain, I learned the answers to many of the questions you seem to be stumbling with. And the only changes I had to make was adding two tiny islands to hold the HQ and one base for each of the other two countries to satisfy the requirements to upload the terrain to the HOST after Hitech asked me to distribute that training terrain through the custom terrain HOST.