So, are you saying that once I have made the terrain, I will be unable to do further conversions or analysis? It's a little bit of a round about method, but the only one that seems to work - I need to create a DEM from a raster, so I can then undertake hydrological analysis (flow accumulation, direction, stream order, high resolution morphological mapping, etc.). Each of these options only allows the use of a raster, so I would need to convert terrain to raster i suppose...