AFAIK (and it's been a few years since I've looked), most people still block out interiors with the DIF (bsp-style) editor, but do most of the details and decor

AFAIK (and it's been a few years since I've looked), most people still block out interiors with the DIF (bsp-style) editor, but do most of the details and decorations with a bunch of static DTS shapes (very similar to your heightfield/rocks example). And there is now a pretty nice native DIF editor and you no longer have to use Hammer and weird converters or something wonky like that. Mostly due to hardware getting faster, the engine handles a lot more DTS's than it used to. I'd say the content pipeline is pretty good these days. There's exporters for practically every 3d package. It's certainly still designed like a "last-gen" engine, but that's not a terrible thing since those techniques are well-known and refined by now, and a lot of that makes it a better fit for mobile than a more "modern" engine.