Alert: You need a good paint program like Adobe Photoshop or Paint Shop Pro (worked better for me since I don't know my way around Adobe Photoshop).
1) I downloaded the NWN2 plugin "Yet Another Terrain Tool" here:
http://nwn2yatt.sourceforge.net/
2) I downloaded a free heightmap generator here:
http://www.localblooddrive.co.uk/download.html
3) Had to download a couple of Java items here:
http://java.com/en/download/windows_xpi.jsp
and here:
http://java.com/en/download/windows_xpi.jsp
4) Install them all. Read the instructions on the Landscape Studio to generate a Heightmap that resembles what you need.
5) Save the .jpg and open with paint program. Modify it to better fit your needs.
like here:
http://jpa.homeip.net:8080/NWN2TFN/Imag ... map_03.jpg
to here:
http://jpa.homeip.net:8080/NWN2TFN/Imag ... map_10.jpg
*Alert*: Follow the size definition for your heightmap .jpg at the YATT link above, or you will have the difficulty keeping the area you want players to run around in actually within the walkmesh of your area size.
6) Read the instructions to YATT and follow closely. At this point, try not to mess too much with texture or color mapping like I did, unless you actually *do* read the instructions, unlike me.

7) Smooth, raise/lower and walk/non-walk your walkmesh to fit your desires.
That's it so far. I'll look at texture and colormapping later. I fumbled my way through the first day and thought I would share my experience.
Enjoy.