A default new scene in Terragen is a terrain power fractal (These are your hills and mountains) (feature 5000, displace 2000, seed 119)masked with a simple shape shader. The flat surface of the default new scene is that Simple Shape Shader, It is positioned at 0 0 0. This scene is default material set in Base Colors in Shaders. You can displace Base Colors but this will effect the flat surface of the Simple Shape as well as remaining terrain.
In shaders, you can add surface layers to add color (often with a powerfractal) displace(usually a power fractal), limit altitude, and slope. The child of a surface layer can add more color, fake stones, etc.
If you prefer a scene with no hills or mountains.....lower the displacement setting in terrain power fractal from 2000 to around 150-200.