Prometheus, the underlay overrides the actual ground geography of an area. So if you insert a square of underlay data, in the side of a hill for example, you will notice that the area in the underlay will be perfectly flat, while area all around it will flow naturally into a hill. That's what I think is going on in your picture, notice how the ground is getting higher to the left, but the ground inside the underlay area is not following it and continues to be perfectly straight. Thus the difference between the actual ground and the underlay ground keeps increasing the further left you go, as can be seen happening in the picture.
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