It seems like this is happening because your stones are fairly large and your camera is at a low altitude that places it within the area the stones will occupy. The camera starts in an empty space in your attached .tgd but if you increase density you eventually get a stone where the camera is and it encounters problems when trying to render from within the stone. Simply increasing camera altitude should resolve it.
Edit: Upon further investigation it seems like there is more going on than just what I mentioned, although that's also relevant. Increasing the density of the stones is interacting with the other heavy displacement and complex surfacing you have going on and causing problems, most likely related to heavy overlapping displacement. I would suggest getting the stone density the way you want it and then building up the surfacing on the stones afterward, so you don't go "overboard" under those specific circumstances.
- Oshyan
