Alright, gunna try and go through this, and do it in 2 parts.
We'll start with the stock devhead.
So, as we've discussed, the correct way to currently texture terrains is to have a color diffuse texture which paints to the BaseTexture of the terrain, and supplies color to the detail texture, which normally a grayscale/highpass texture of the same diffuse for up-close detailings. Then obviously your normal, and optionally a macro detail texture for intermediate ranges. The macro texture is basically a longer-distance extension of the detail stuff, so I'll ignore it for now.
So, using the 5 textures I'd exported from Substance tools - acting as an artist using a normal workflow - we end out with the Albedo, Normal + Height and Composite(for PBR in the near future). You'd load the albedo into a image editing program and desaturate them and fidget with the levels until it's fairly neutral gray. Depending on the texture's complexity, this can actually be a fair time sink if you're not experienced, and getting the almost-passable results in my images took me about 15-20 minutes of fidgeting for the 5 materials. Pragmatically, that's quite a time cost for 'almost passable' and 'good' results will take longer still, especially when you figure you're very likely to have far more than 5 materials on your various terrains.
Anyways, if we paint them down, at a distance, they look like this. I blew up the preview window so we can better compare the image's actual colors to the in-render results:
As we can see, the colors as supplied on the BaseTexture look pretty good and are accurate to the source textures as we'd expect.
Now, if we were to try and just use our albedo image for the detail as well - either out of naivety or because you want the full color of the textures up close so it looks like the source image, the results are far less pleasing:
As we can see, not only do we not get anywhere close to the preview window's example of what the albedo color looks like when up close, the colors are completely destroyed, the detail is lost, and it just looks BAD.
So, lets try and use our 'almost decent' detail textures a new person would likely put together
Sand and Dirt see a huge improvement. Their detail textures were easy to create because it was a simple desaturate. They don't have much contrast, so they look OK. The colors are washed out compared to the albedo though, and getting it completely dialed in to look the same as the source texture would be a time consuming process.
Grass and Forest Ground fared better than with the albedo color detail, but still don't look good. They have a far broader extreme in contrast, between the grass/dirt and dirt/wood chips for the respective textures. Completely crushing the contrast will likely lose out a lot of the detail(already the grass itself looks like stringy mush), and will definitely not look like the source texture color-wise.
Rock is in a kind of weird middle ground. It's got a bit too much contrast from the cracks, so we're dealing with some discoloration, but it's not HORRIBLE. Enough fussing to dial it in would produce an acceptable result.
So with the current intended method of grayscale/highpass textures, we can see that yes - you can definitely get good results, but it's already - even with minimal correctness - more labor intensive, and still doesn't just simply return back the stock texture colors if that was what you were going for when looking at textures up close.
The tradeoff, however, is that if you get those detail textures dialed in, the base texture color blending in creates a good detail of visual variation, and it helps mask patterns and keep things visually fresh, which is absolutely a bonus.
Part of the problem with details getting blown out in stock currently is that it's not just simply a color modifier, but is a somewhat odd multiplier situation, so darker grays in the grayscale will darken the final merged color of BaseTexture + detail, and brighter grays will brighten it. The range on that is innately half because it's split + or -, so you get some extreme darks and brights at the same time because it's kinda unintuitive like that as well. To avoid extreme contrasts like that with the detail, you need most all the detail texture to be as close to true neutral gray as possible, which restricts you a good bit.
If we were to stick on with the highpass detail approach, we'd want to help make the modifier behavior of the detail textures easier to understand and work with so it doesn't completely blow the detail out without even approaching the extremes of 0 or 1 brightness levels. Also some examples/guidelines for how to produce good grayscale detail textures to cut down on how much fussing is required to achieve good results in order to save time while still making everything look good.
Tomorrow, I'll use the same textures with lukas's build and see how the newer approach fares with trying to get the detail textures to display the true color of the source texture to test situations where that's what the artist wants to do.
If there's any bits that you guys feel need further clarifying so we can all be on the same page about this, lemme know.