Expressing real landscapes as terrains: from LiDAR to Unity

I'd like to adapt some aerial 3D laser scan (LiDAR) data into a Unity terrain (see bottom for the data itself).

There are lots of ways to approach this, but if you've been down this road any criticism is welcome for my proposed steps below:

• Extract a DEM from a LiDAR dataset via LAStools

• Combine hero DEM with outlying, lower resolution DEMs, to gracefully handle the borders of the high resolution area

• Convert DEM to image (GeoTIFF), export as type “.data” from Gimp/PhotoShop to obtain a Unity-compatible RAW file In Unity, import RAW file → Real World Terrain (https://www.assetstore.unity3d.com/en/#!/content/8752)

• Using Real World Terrain, texture terrain with 0.25m sat images

• Export Unity terrain

• In Unity, import DATA/RAW file → Gaia / Map Magic

• Add forests, grasses, other vegetation

• Export Unity terrain Add sky, ocean elements

As an option for the terrain input above, I could triangulate that LiDAR point data into a mesh, then convert the main to a Unity terrain via 'Mesh to Terrain' or similar.

p.s. -- Here is a link to some of the USGS Big Sur LiDAR data (ARRA-CA Aug 27 2014) that I'm using: https://catalog.data.gov/dataset?q=&sort=views_recent+desc&collection_package_id=55e67773-09ac-459c-8be3-3fb2750ddc9b&as_sfid=AAAAAAWPrPaCYlhEpBe0ubd7kLLIqD7qO1pecVRFlfYwc2hCSEi0uAko2vlLkquWslmPA8-n75vdhS8P-o-zQe1wQBajFz5hErQ-hvDfTkKYpLNkUlpt1oHH-8wcSvzD81OXH8s%3D&as_fid=a59d488213daf5ded4172bbaae393fd840d8841b&ext_location=Big+sur%2C+CA+%2893920%29&ext_bbox=-121.9022%2C35.7942%2C-121.1957%2C36.335&ext_prev_extent=