The deterrace code generates a number of peculiar artifacts and doesn't really work as well as I had hoped.
Using the mound tool should make it possible to get a better representation of your area, I think. The thing I did above was with a simple linear profile but the intent was to show that stacked mounds can get a good effect analogous to mountain chains. You can set the mound edge-to-center profile to be whatever you like, including a sigmoid-type curve to ease in and round over the tops.
The most direct way is to use the tesselation tool, but it gets a bit cumbersome after a thousand or so points.