The real world partitions land and water by treating values below a certain threshold as ocean. That's not the problem.

There are tons of good terrain generators. Try Google. VistaPro, from the 1980s, is the classic.[1]

So far, nobody has built a procedural city generator good enough to generate a detailed city at ground level. This is one of the better ones, but the result comes out looking like a modern prison.[2]

[1] https://en.wikipedia.org/wiki/VistaPro [2] http://orphancity.tumblr.com/