I am somewhat new to game programming and I just started getting into Blender and Torque3D. I am working on a small RPG with a friend of mine just to get the feel for things before we jump into something bigger. Actually my aim right now is to build a small simple town (2 or 3 buildings, fences, few random objects) I can run around in, then go from there. I have been doing a ton of research lately trying to figure out terrain and small towns. Do I need to model every building individually for a town in Blender, then piece it together in Torque? I think I have the terrain down pretty decently, but I don't know how to combine it with the buildings. Do I make the whole town small and scale it up in the game engine, then piece together different parts of terrain? Also, with terrain generators, it doesn't seem like I would be able to make an underground tunnel or a basement or anything since the terrain will cut off the entrance underground. I don't normally post (5 posts since 07) unless something is really confusing me, sorry if this is something that has been asked a million times or if I am just not searching correctly. I just can't grasp how to get the buildings to join with the terrain to make a town or city. Thank you very much in advance!

Maybe I didn't explain what I am confused on, it really has nothing to do with torque specifically. I am just wondering if generally people model and export every individual building separately then put it together with the engine or if you model an entire city and export the whole thing as 1 model in a 3d modeling program like Blender and scale it up so your character can run around it in the game. All I am trying to do is have a big open field with 2 or 3 buildings, even if it was 3 hallow squares with a doorway that I could walk around to get a feel for everything. I don't want to learn the wrong way in the beginning and have to remodel everything or take a ton of time to shift things around and export because I didn't know what I was doing. It is hard for me to grasp how you would model a big area like that very small in Blender and have any type of detail in it i guess. Thanks in advance!

It's not necessary to bump the day after; forums take time to get replies.

Regarding caves and tunnels on terrain-like environments. First off, have your base mesh be constructed as procedurally as possible - that is, you apply a heightmap as displacement data on a segmented plane and adjust the strength\scale until you get as far as you can with just using that heightmap. There really isn't a way to represent underground levels using it.
If you need caves and tunnels, sculpt them in after you have your base mesh. This takes time to do right.

Regarding building-to-terrain connections: let's think of the results you'd get using two ways. 
One is you create each building mesh and slightly 'pierce' them on the terrain without actually making them part of the same mesh.
The second is to actually weld the buildings to the terrain, so everything is one perfect, almost crackless hull.

These methods are respectively illustrated in the following (to the right is a bottom view of each method):


The first way, simply piercing the buildings, doesn't require extra polygons for the connections like the second way does (which requires additional edges). In a huge level full of these buildings the first way is optimal, doesn't result in visual artifacts and still works with lightmap and collision solutions. Prefer this over the second way. For backdrop buildings (in locations where the player can't reach, being there just for the aesthetics), you can even delete polygons that the player will never see from any walkable spot (i.e: walls and parts of the roof that are completely occluded).

Oh wow, thanks for the great explanation! It cleared things up a bit for me! I didn't mean to bump it, I just thought that I wasn't getting replies because I wasn't clear with my question