That is a drawback of UT. If you do a web search there are some "fixes" out there that are available that will take care of some of these issues. Terrain mesh does seem to help out, Im using FSGensis global mesh, but its not 100%. Another problem created by the mesh some airports will be sunken into the ground

You will also notice some of your static scenery will be misplaced, bridges over water always look crappy. You can turn off bridges in the UT interface and set an offset for streams.
Try a search for "UT FIXES"