Well, since It may be a while since I implement any of this, I'll respond to these points:
[1]: I'd never really thought about that at all.
Aside from making it look realistic, and fit with the atmosphere, it was mostly a physical justification for the bluish lighting outside the range of the lamps on the shroom. I will look into this.
[2]: You have a point here. The large scale terrain of the area used to be a rather large hill. It seems, though, that the concept calls for small hills closely packed hills. My plan, however, is to make the forest dense enough so as to keep the explorer confined to the paths. I'm not entirely sure how to go about this though.
[3]: I really don't know what you mean at all. There are no rocks in this scene. Either way, with the polycount I'm looking for, I'm taking the route paved by the rest of uru, and trying to make the textures do most of the visual work, rather than having busy-looking meshes.
On second thought, it seems that you're referring to one of the tree roots attached to the willow, which has the same texture as the rest of the tree.
[4]: Also a good point. I do have some deciduous leaf floor textures, but they're rather brightly colored. Working on this, so look for improved ground texture in the future.
Good comments.