At work I came across this nice article that explains some basics of GIS data projections, datums, geoids, etc. Although the target audiance of it is more the oil industry, I think it would also be good reading for people making FsX terrain scenery and wanting to know a little more about what could be involved when using GIS data. Because knowing that the data is in the right projection, etc is very important for the best result.
I know it’s an old post but I was curious and so managed to dig up a working link to the article: http://www.iogp.org/pubs/373-01.pdf