Is it possible to fase terrain at the edges, and add like an invisible wall to stop the player falling off the level?
To achieve the fade effect, you might try using fog settings. (It's under Edit -> Render Settings). There's also the Far Clip variable in the Main Camera that you can play with.
In regards to stopping the player from falling off the edges, you could use invisible walls. Just insert a plane or cube (GameObject -> Create Other), size it as you see fit, then set the materials to 0 to avoid rendering any texture. You'll probably want to set the wall to not cast/receive shadows. This will be your invisible wall.
There's probably an easier way to achieve the invisible wall effect, but that's what I find to be simplest.