The HeightfieldTesselator converts a height field in the form of a greyscale image into a scene consisting of a number of GeomNodes.
The tesselation uses an LOD algorithm. You supply a "focal point" (X,Y) which tells the tesselator where the bulk of the detail should be concentrated. The intent is that as the player walks around the terrain, you should occasionally move the focal point to wherever the player is. You should not move the focal point every frame: tesselation is not that fast. Also, changing the focal point may cause popping, so it is best to minimize the number of changes. There are a number of parameters that you can use to control tesselation, such as a target polygon count, and a visibility radius.
The heightfield needs to be a multiple of 128 pixels in each dimension. It does not need to be square, and it does not need to be a power of two. For example, a 384 x 640 heightfield is fine. Be aware that tesselation time is proportional to heightfield area, so if you plan to use a size larger than about 512x512, it may be desirable to benchmark.
Altering parameters, such as the poly count, the view radius, or the focal point, does not alter any GeomNodes already generated. Parameter changes only affect subsequently-generated GeomNodes. It is possible to cache many different tesselations of the same terrain.
Note: Various other algorithms for terrain LOD have been contributed by users at the Forums.
Note: this section is incomplete. It will be updated soon.