What needs to be changed to address this problem is the amount of detail in the ground... PR Arma2 are looking at solutions for this same problem and one of the most promising solutions is to decrease the mesh size of the ground, at current it is 10m square a mesh, so terrain can never be all that detailed... the PR Arma2 team have shrunk down the mesh to 1m square allowing for a lot more detail in the ground, the videos of what they call `micro terrain`
you can read more about it in their updates... http://www.realitymod.com/forum/f509-mini-updates-team
