Actually displacement *is* being applied. When you create a new planet it has a Power Fractal Shader applied to it by default to give it some basic form (other than just a smooth sphere). The displacement is set to an ampltitude of 5000 meters, which gives you average Earth-sized mountains for a normal-sized planet. If you significantly decrease the planet size as you have done here then the relative size of those displacements is much larger and so you get an extremely displaced sphere. Nothing unusual going on here though.
To see the shader node right-click on the planet node and choose "Internal Network". Then check out the settings in the Power Fractal. Alternatively you can click the Planet 02 node in the Objects node list, then click the small network button to the right of the node name at the top of the settings box. This will show the "internal network" in the small node window to the right.
- Oshyan
