You can create DEM style height maps from contours that you make yourself. I posted my technique here:
http://www.cartographersguild.com/sh...l=1#post191015

You can look at Global Mapper too which is not free but very powerful.

I know that Anteworld has some terrain editing ability but its rather limited. Its more of a real time viewer.

Normally you would manually input the basic contours in and then let rip on it with some kind of procedural tool to make it look more realistic. I use my own so I dont have a lot of experience with other peoples apps. I think probably World Machine may be your best bet. At MEDem (http://me-dem.me.uk/galleries/Outerra2/gallery.htm) the guy who does the terrain modelling uses Global Mapper and then a little Wilbur and some real DEM's like the NASA / shuttle's public domain SRTM downloads to build up a realistic terrain. A little random noise and some clever blending of it all goes into the mix. Then the result of all of it gets exported to Outerra (which is sorta Anteworld) to view it. But its a heck of a lot of work - you gotta be committed to the cause to endure the process.