That would be under Image Overlays>>Color-to-Altitude Conversion. You load the image as an image overlay, pick colors and assign altitudes, then tell the system to go. If your starting image isn't pure colors but is shaded ( e.g. http://mola.gsfc.nasa.gov/images/mercat_med.jpg ), then the shading will come across as blocks of missing color.
The same problem applies to JPEG images to some extent because the lossy compression scheme results in blocks of similar but not exact colors along boundaries.
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The same problem applies to JPEG images to some extent because the lossy compression scheme results in blocks of similar but not exact colors along boundaries.