*edit, If you read that, sorry. I am a tad tired and irritated by this issue.
Update, the original worldspace was 22x22 cells, I just increased the dimension to 30x30 because I realized the northern point of the island was a tad close to the edge and wouldnt leave much room having colision boxes and the end of the painted terrain. Well just increasing the size fixed the bad LOD ground textures, but a new issue has surfaced. i now have black stripes on some of the cell borders showing in the LOD. Looks like one of the screenshots in the thread Acidzebra provided. Maybe make it 32x32 will clear up the edge issues by having a standard dimension.
*Edit, Found out what the lines in the LOD ground texture was from. The normal maps had them and those lines were actualy a normal maps shadow that they create to make a flat surface look like it is not. So... I managed to get the LOD done by flood fill the normal maps to a solid color, just a flat normal map and cant get Oscape to work correctly, still get the original brown LOD ground with it.
No idea why Oscape wont work correctly for me, still no idea on why the ground texture was the default brown. Maybe something bugged in my install even after validating the steam cache.
Edited by jet4571, 12 March 2013 - 03:18 AM.