Yeah most terrain editing tools use the height map in a different way to SE.

ok. also when i did a test on textures. save it size as 2048x2048, load it in a terrain editor, show it come out smooth, prefect. so put it grayscale, show terraces . mhm

You can apply a blur, I use "selective gaussian blur" in gimp. You have to play around with it until you get rid of the terraces without it looking too smooth. I then apply "Erode" to make it look a bit sharper and realistic again. I am sure there are counter parts to these filters in Photoshop.

sure, something i have to do. all of my texture come out looking like Terraces thour. sometimes they don't. some textures used 4 or more black,white colors.

Nice! Very interesting looking terrain! You should smooth the terrain out a bit though. I could give you some tips if you want to.