Yes, you are correct. Terragen 3 has a GI Cache function which fixes this very effectively, but it's only available in licensed versions (see feature comparison here:
http://planetside.co.uk/products/tg3-product-comparison ). In TG2 you have to just avoid using GI (use Fill Lights instead, for example), or you can try using lots of overlap and taking care of blending in a stitching app like PTGUI (PanoTools). TG3 also has a Spherical Camera and Fisheye Lens, both of which can help for these kinds of projects.
- Oshyan