If you right click the fractalize button there's an option to convert Straight to Smooth. You can go back and forth with it. You might want to fractalise it just a bit more right now before going smooth as that will give it a more wiggly appearance. Don't go overboard, though. No more than 3 hits with the fractalize tool at it's default setting. Then go smooth and see what you think.

Save a copy first ;)

All good suggestions :)

You can use the lake polygon as a cut out shape on more than one sheet. I've set it up for you in this version. All I did was add a Color Key sheet effect to the TERRAIN FARMLAND sheet, change the properties of the lake to solid colour 6 (magenta), moved it to the TERRAIN FARMLAND sheet and copied it from there to the LAND sheet.

There's nothing left on the actual LAKES sheet now.

I hope this is what you wanted?

You're welcome :)

It might be worth considering if you might be using just a little too much detail generally if you end up having to use SIMPLIFY all the time to resolve these line glitches.

30 minute shout :)