The height (not Z actually but Y = up in Terragen) of a population is determined by the shape of the object or terrain it's anchored to. If you have an object with one part at 1 meter above ground, and another part at 1000 meters above ground, and you populate on that object, you'll have some instances at 1 meter and some at 1000. If you have a procedurally displaced place that you're using to anchor a population to, your population instance's heights will depend on the total amplitude/height of the displacement.
Populations on populations are not currently possible. Might be added in the future, I don't know what the technical challenges are though.
I'm not sure what you mean by "pre-populating", but as others have said you can certainly bring in an object that has, for example, 100 trees in it (created in another program). It would have a lot of geometry and would not be able to conform to a terrain using the populator, but you could at least populate on it because it's a single object. It's a workaround, not a total solution, but depending on what you want to do it may be effective.
- Oshyan