Mental Ray has started to get good, but as far as I'm concerned Vray is better. Maybe I haven't seen what the latest Mental Ray can do, which is more down to my company's policy than anything else.
I just wanted to chime in and say that I actually like those clouds and think they have, for want of a better term, a 'Harry Potter' feel to them. I think that Joe Public doesn't really know what clouds look like, and to be honest, it's not the point. It's more a case of whether the viewer 'buys' the scene. Which often comes from the cutting in the edit, but a lot more from the general compositing/grading of that sequence, which is why you have varying skills on a production workflow, ie 3d modelling, texturing, lighting, rendering, compositing, editing, within a team of people.
I think it unfair to expect one application to fully achieve all of those disciplines. Which is why I think beyond 64bit, Terragen should concentrate on being able to output separate passes in the render flow, to compliment it's position in that stream. And I'll tell you what; full integration into Backburner would be magnificent.