The to go for generating a heightfield from any shader is this:
1. Make a "heightfield from shader" node
2. Plug the Shader you want to make the heightfield from into the "shader" port of the "heightfield from shader" node
3. Make a "heightfield resize" node, connect it to the "Input" of your "heightfield from shader" node and open it up
4. check "re-sample pixels" and specify how many samples you would like to TG2 to take. With "re-size in metres" you specify the dimensions of the to-be-generated terrain.
5. Now hit the "generate" button and wait until it finishes
6. right-click the "heightfield from shader" node and choose "save file" from the context menu. Choose a path and a filename, and ADD .TER (don't forget.that bit).
Now you have a fresh heightfield made from you current scene. Note, that as we're speaking heightfield, the generated terrain cannot contain ANY overhanging parts.
Cheers,
Frank