Yeah the image I have uploaded is 16bits and when you view it like the upload then every 256 shades and it reverts back around to black and climbs back to white again. I.e. my image is 256 times as accurate as your greyscale cos yours is in 8 bits. If you want to drop the height resolution then you can do that with image magick.

Its no problem. Now that I have it converted ill convert it some more to HF2 and generate the 8 bpp PNG file. If you have photoshop tho you might still want to grab that file cos it might look right in that.