Terrain flipped, then texture doesnt line up?

The "raw" format in which Unity imports heightmap data is just a stream of binary values - it's not really a recognised file format. As such, there are no particular conventions about whether the first value (0,0) is at the top-left corner or the bottom-right corner, or whether the values are listed in row-wise or column-wise order, for example.

Depending on the conventions of the application used to output the raw heightmap file, you may therefore find that you need to flip, mirror, or rotate the heightmap to get it to appear the same in Unity. I don't know World Machine but, when recently importing DEM data via GDAL, I found that I had to rotate the image 90' clockwise, which I did in a script as follows:

 using UnityEngine;
 using System.Collections;
  
 public class RotateTerrain : MonoBehaviour {
      
     void Start () {
          
         Terrain terrain = GetComponent<Terrain>();
          
         // Get a reference to the terrain
         TerrainData terrainData = terrain.terrainData;
          
         // Populate an array with current height data
         float[,] orgHeightData = terrainData.GetHeights(0,0,terrainData.heightmapWidth, terrainData.heightmapHeight);
  
         // Initialise a new array of same size to hold rotated data
           float[,] mirroredHeightData = new float[terrainData.heightmapWidth, terrainData.heightmapHeight];
          
         for (int y = 0; y < terrainData.heightmapHeight; y++)
         {
             for (int x = 0; x < terrainData.heightmapWidth; x++)
                 {
  
                 // Rotate each element clockwise
                 mirroredHeightData[y,x] = orgHeightData[terrainData.heightmapHeight - y - 1, x];
             }
         }
          
         // Finally assign the new heightmap to the terrainData:
         terrainData.SetHeights(0, 0, mirroredHeightData);
     }
 }

I wrote up more details on the whole process in a blog article here:

http://alastaira.wordpress.com/2013/11/12/importing-dem-terrain-heightmaps-for-unity-using-gdal/

All you have to do is add a "Flipper" device in world machine immediately before the heightmap output and then double click on it and check off flip vertically. When you rebuild and re-import it will fix the problem.