In order to get nice looking swaying grass you need to go to your TerrainInfo, click on propertjes and open up the "decolayers" tab.
Then click on the decolayer you wish to alter, and a bunch of properties will pop up. You need to set the following properties to make the decolayer sway:
- AnimationAmplitude: can be anything above 0, but a value between 0 and 1 is recommended.
- AnimationSpeed: same as above.
- AnimationType: set this to AT_Wind.
- AnimationWorldperiod: can be anything above 0, i recommend a value around 1.
Voila. nice looking, swaying grass.