Wasn't the... authenticity of that image in question previously? It doesn't look like it's finished, either. The top looks way too rough, and not the natural kind of rough.
Anyway, there's two ways to go about applying textures to things. There might not be a technical difference between the two, but I think of it that way.
Texturing is what you'd be doing in a map (unless you use the technique that DJ-Ready and others use, it's different in that respect, and more akin to the second method) in which you have a collection of images which you apply to surfaces. Kind of like a palette, and you blend them to make them look natural as best you can.
When working with models, you'll have one (or atleast relatively few) images which you assign certain parts of the geometry to. This allows for a more natural look, as you won't see apparent dividing lines of the geometry as often, but the way the "skin" looks can make or break the appeal of the model itself.
I wouldn't recommend using a model for something like a mountain (or any other major feature of a map) because collision with models is determined by bounding boxes. Doing something like climbing the mountain, or being thrown into it, without ever actually touching it, would kill the feel. You're much better off modeling it with world brushes, in Hammer. The method of texturing you use when doing that, however, is up to you.