Terrainview is the program to EDIT terrain L2 file. In the old times we used this program to tile hundeds and thousands of segments (1 segment == 256 tiles, 64 theater == 4096 segments) but today we are using CATE to auto tile the terrain and Terrainview is mostly used (at least for me) just to check out small details and such things. No actual tiling is done with it anymore.

Some explanations for features, these are sorted by menus.

File → Load/Save PCX map: Don't use it.
File → Load Far Tiles…: loads fartiles.raw and fartiles.pal
File → Load Texture.bin: Loads texture.bin, use this if you have changed your texture.bin or texture dir settings so it will “refresh” the pcx palette for you.
File → Load Terrain Features: Loads terrain feature (TDF) files. These are the roads, rivers, cities and coast/labels into the theater map.
File → Clear Features: clears all features currently loaded.
File → Configuration → Use software 3D: use it, some cards CRASH on real 3D mode. use it.
Configuration → Use Borders: The border around the segment view, with the red line. use it.
Configuration → Load texture.bin: Loads texture.bin in startup, use it.
Configuration → Texture dir: is where H tiles are located.
Configuration → Texture zip: Used to host all tiles, but its very slow to use it. avoid it.
Configuration → Texture.bin: dir and filename for Texture.bin, to hold the tile info.
Configuration → Auto Tiles → Road/River/City/CityRoad, these are the default tile-set names for auto tiling but since we have now CATE these aren't much of use.

Edit → cut/copy/paste: Not used.
Edit → Find Tile: finds a tile ID (offset) for you. if you press OK in segment view it continues to find all matching tiles, or if you press cancel it stops.
Edit → Replace Tile: Replaces tiles on whole terrain. First is match any, 2nd is replace with random selection.
Edit → Replace Tile Region: Not used.

Operations → Apply L1/L0 Map: add tile changs to l0/l1 maps and creates .raw etc.
Operations → Apply to L3-L5 Maps: basically experimental stuff - until the installer stuff came along.
Operations → Computer Normals: compute the X2/X3 parameters based on terrain levels.
Operations → Estimate Tile Colours: Not used.
Operations → Make Theater: Use PathMaker
Operations → Make MEA: Use PathMaker
Operations → Check for Bad Tiles: Searches tiles that does not exist in texture.bin - bad tiles.
Operations → Save Bitmap: saves bitmap (bmp) file of the theater map. You can load any and all features into the view which it paints the the bitmap.
Operations → Normalize elevation (mode/mean): Not used (use Tinstall).
Operations → Normalize elevation (manfred/from L2): Not used (use Tinstall).
Operations → Split Segment: Removes sharing on this segment.

Auto Stuff → Analyze Current Map: Not used.
Auto Stuff → Auto Tile: Not used.
Auto Stuff → Compute Feature Tiles: this is terrainviews auto tiling. But you should use CATE to handle all auto tiling. However if you decide to use this (I see no reason), tile the features in this order, first rivers, then cities and lastly roads.
Auto Stuff → Auto Coast Tile: Tiles coasts.
Auto Stuff → Guess Bridges: Tries to guess bridge placements.

View → View Segment: same as double clicking segment. brings the segment view window.
View → View SegEment 3D: Same as view segment 3d button.
View → View Tile Palette: shows PCX tile palette, all tiles that are in the texture dir and in texture.bin.
View → View Tile List: shows a list window with all the known tiles in.
View → View Grid: Shows you the segment grid over the terrain.