I am not sure you can do this in Terragen, but the shadows from the sunlight are too harsh and need to be softer. This should reduce the mathematical feel to the landscape a little. Nicely composed image, with a good use of the physical elements. Use of materials is the key.
I like the view and composition quite a bit. It has too much blue in it, though. I would balance it with more earth tones in the terrain. Good work. Still ain't quite figured out Terragen myself.
I dont like the reflection of a cloud in water, although it fills potentially empty space. Actually, i dont like any of those clouds at all. But that is no way your fault. Just have not found a real taste of that software yet... On the other side, composition is really great! Idea of the picture is also very interesting and i think very inspiring. You have great fantasy and ability to drag an observer in the picture. Great work.