Artifacts/Strange Lines in Terrain to Raster Output

[JonKwong]

I'm using ArcGIS 10 and Windows 7.
I have built a terrain from a single LAS file with 34 million points of combined TLS and ALS.
I created a DTM using the Terrain to Raster tool at 0.2m resolution.

I get these strange lines in the DTM (see Snapshot1). I have checked the points and terrain and they look fine.
I tried the Terrain to Raster tool at different resolutions yet the lines still appear at the same locations.
I notice the lines only appear at areas with ALS points.

The artifacts are causing problems to my slope and ArcHydro results.

Has anyone encountered similar problem?

Jon

[PaulHuffman]

How can I view your attached images?  Are they still saved? 

[KeithAddison1]

Yes.  This artifact line moves around depending on the viewing scale, there is no breakline or any discontinuity with the elevation values.  Sampling type & stretch type seem to make no difference, rebuilding pyramids seemed to reduce its prevalence but didn't make is go away.  Changing format from tif to jpg made the artifact go away.