A scalar is just a single number, a quantity, or a magnitude. If you read up on scalars the definitions are more specific and jargon-laden than that, so I'm not surprised that they are hard to understand, but I think for the sake of understanding what they are in Terragen you should think of a scalar as a number. e.g. 0, 1, 2, 5.6, -10.3, -5, 1 million, etc.
A scalar only becomes a point in space after you multiply it by a vector, but that's because the result is a vector, not a scalar. Often we just deal with scalars, without vectors, so there's no need to think of them in terms of vectors all the time. So, scalar = number.
If you multiply a scalar by a vector (that is to say, multiply a vector by a scalar), the scalar multiplies the length (or magnitude) of the vector to create a new vector. Vectors can represent the difference between two points (i.e. the displacement from one point to the next), and when you multiply such a vector by a scalar it multiplies the length/magnitude of the vector. However, if you are using the vector to represent a point in space then it multiplies the point's distance from the origin, because a point is represented by a vector that takes you from the origin to the point.
Otherwise, a scalar is just a number.
Matt