Make sure your map has nu Alpha Channel or any transparancy of that sort.
Also, did you remember to put your map into the FeralHeart folder, rather than just a new folder at a random place?
And usually when I make a map on my own, it 'stops working'', so I simply open my map back up in GIMP, all while having the Watermill terrain open- and then I just copy-paste it over.
Afterwards, I just simply 'save as' (and Flatten the layers) another terrain, like 'larryTerrain.png' into the 'terrains' folder.