LOD mesh becomes visible when lowering the landscape.

[sandor]

If you see a 'film' or 'brownish texture' (in-game) you lowered the land considerably compared to the original situation (below the original LOD mesh height data). Look at the attached screenshot as well (made by Ibsen's Ghost).

You can walk through the 'texture' or 'film'.
If you generate a new LOD mesh (after finishing the landscape alteration) you won't see the 'film' anymore. Use 'tcl' to go below the land and you'll see the film (LOD mesh) following the contour of the landscape which reflects the height data of the LOD mesh. If you move farther away, the game will render that mesh plus the generated textures.

Look at the two other screenhots, DistantLOD disabled.
The second one shows an overview of Steadhelm.
In the third one I go below the bridge and you can see the stream and the LOD mesh following the contour of the stream.


Why?

Generate a LOD mesh for a flat HM quad and add the mesh and the LOD textures to the assets.

Secondly you start to alter the land e.g. creating a large canyon (lowering the land drastically), the LOD mesh doesn't reflect the changes (in-game) and becomes visible as a 'texture' or 'film'.

Related.