When every i use to brush tool for terrain, its been slowly decreasing in resolution and becoming increasingly more blocky.
I believe I was having the same issue and it was driving me nuts. The key to me to get things back to how I though it should act was increasing “Control Texture Resolution” under terrain settings. Because I was using a 2000 x 2000 terrain, a 512 control texture resolution setting was to low, making it blocky. Hope this helps someone.