Ahoy, I've just experimented with terrain splatting, a screenshot can be found at http://www.inutil.org/terrain-splatting.png Note that the splat maps do not exactly match the terrain yet.
The approach is rather simple and efficient: For n levels of height texture differentiation you need n-1 splatting maps. The PagingLandscapeManager computes these at runtime, but with the plain Octree/TerrainSceneManager we'd need to calculate them out of the heightmap and generate splat textures on the fly. This is definitely doable, but as a switch to PLSM is needed anyway some time in the future and it already contains this feature I don't want to spend time on an own implementation here. Cheers, Moritz