How it might be possible to greatly increase the draw distance

I was looking at the worldmap and thinking about that time someone took it and used it to create a heightmap in some 3D modeller, and something occurred to me: Maybe an enhanced version of this could be used to draw stuff really far away - in very low detail, but executed properly, it would be enough.

1. Generate the same kind of data that is used to create the LANDSAT-like overlays for the world map (the ones that displays objects and shadows), only at significantly higher resolution. Instead of marking large primitives as all being the same dark shade, take the approximate color of the topmost instead. The further away it is, the more it'll be blended with the fog, so it should look reasonably good.
   
2. Allow the user to select an intermediate draw distance.
   
3. The intermediate draw distance becomes the point at which objects change from being rendered normally to being displayed in the roughly approximated way described above. I believe a system like this is already in place for lighting - I have noticed that from far away, a bunch of lights close together seem to cast an undifferentiated volume of light, and you only see the finer details as you draw closer.
   
4. The fog will mask the lack of details.
   

One of the tricks is figuring out how often to regenerate it, since it's probably a bit difficult to do constantly.