True. It would be really nice for each tactical battle to use its own mapgen algorythm to create a ballefield based  off of the tile and the ones surrounding it.

Therein lies the problem.

Perhaps so. It looks like a pretty rich world:

.jpg is your friend when uploading and posting large picture files. I've never seen that pic before so thanks.

Oh my god that is an awesome screenshot Kitkun! Thanks for those two goodies - they should especially put this one in the Media section... It makes me drool.

Edit: I'd like to point out that the channeler has 10 essence and appears to be Level 1 (although that number could mean something else). Also, the roads are a little bit wavy (but it appears to be aesthetic and doesn't deviate outside one tile), and the city walls look like they're made of hedges. One thing that has me a little nervous about this game is that it looks like I'll almost only play the good factions - I don't like the idea of turning my land into evil lava-land. The Channeler appears to be learning the spell "Scorching Touch" and researching the "Weaponry" tech. Population: 11.

More on topic, a while back Brad said that combat would take place on a zoomed in portion of the overland map (presumably just one tile, but who knows!). He also mentioned things like obstacles and the like, so not every tile will be the same. I personally hope that things like elevation effect combat - that would be awesome and add a huge strategic element to combat (like in TW). If terrain doesn't much effect combat then location hardly matters - but the moment terrain enters the equation things get so much more interesting!

I hate, with vehemently venomous passion, random battle map generators.  Anyone that's played HoMM5, that right there is a prime example of what not to do.

Ones that follow the terrain would be outstanding.