By 'adding' a DEM what are you trying to accomplish? Do you want to create a hillshade effect etc. and how are you doing this at the moment?
Looking close at the images, it looks like you have a hillshade already, is this a premade layer or have you created it from the DEM?
for larger scales you would need a hillshade derived from a higher resolution DEM, as it looks like the one you have currently is likely 1km.
