Unfortunately Mitsu, your coastline will remain jagged/sawtooth like that. There is nothing at this point that you can do. Its a limitation of the terrain texturing system, and our current textures.
To me its the biggest limitation of the current editor and hopefully HTC will give us a fix for it.
But IMO its better than nothing, and something I can live with.
If you try to fly over the port area at Tunis, (if you can squint your eyes a little and ignore the sawtooth coastline), it will definitely look like the real harbor area.
Corsica, Sardinia, Sicily, and the "Boot" area of Italy, are all very recognizeable as you fly around within my terrain.
Try slightly different scaling factors to the terrain data you load in, and it might help some.
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Vermillion
**MOL**, Men of Leisure
"Real Men fly Radials, Nancy Boys fly Spitfires"