The UESP map is very interesting! I doubt any creation of mine would be of the standard of the professional modders, but you improve through practice I guess. I wish someone would make a decent, up-to-date video guide of the Oblivion Construction Set, rather than the Skyrim Creation Kit.[/size]
Do not say that. You do not know what you will be able to make as you will involve in the process, adjusting stuff until perfection. I could write a guide but I will not but I can do bits and I guess I am easy to follow when i describe stuff.
Why does not CSE works for you? Do you use ENB? I have a fix for that published here at this forum. 2 Bat files that turns on and off some dll's that CSE needs that screw up the game. So I start CSE and the game with those 2 bat files.
Lets make a tiny Island to start with as a complete world space will be TOOO MUCH!!! A single small isle will keep you occypied for a long time anyway. Start small, and grow later. If you need another Isle later on, just add one more cell and use boats and NPC on boats between them. How big Settlement do you wanna make? A village, smaller city or one at the size of IC? Or do as kat sayd, make your settlement anywhere and I think the space between Chorrol Skingrad or Chorrol IC is damn good choice. Do not delete trees as they will remain most likely, well you can try delete them and go in game to see if they are gone or not. Moving trees can work, but if you visited the area earlier, its position might be saved in your savegame. But there is a solution, to making the Referenced Persistent, giving them name and have a questscript adjusting them.
Use Questscripts as much as possible for stuff that do not need to be run every frame. A questscript runs every 3s default. A objectscript runs every frame, between 8-60 times a second and should be used as limited as possible. I love Questscripts as they do not make performance issues at all, well as long as you do not add twisted loops inside them that is... 
Well lets build a small Isle:
Click the Menu [World] and choose [World Spaces...]
Rightclick on the cells and choose [New]

Enter your data and make sure [x] Small World is checked, which is is default in CSE

Click [Apply] and [Close]
Change to your Region

DoubleClick on Wilderness or 2 single clicks and rename it.
Start with Wilderness 0,0, go to the menu World and choose Landscape Editing. HeightMap is cool but I do not use it as it is messy I guess.

Choose a suitable Radius at the Landscape editing window
Click in the preview Window and press your left mouse button and drag up and keep doing that until you built an Isle
To change the texture, choose a texture in the Landscape tool and make a smaller radius and right click at your Isle.