ok I see what they are doing, adding displacement to low poly objects can be done, since the BSP engine uses brushes (pretty much triagle strips) for thier prefabs (all objects other then characters) displacement maps can be used for things like when a rocket hits a wall.
This is limited though since you can't do fine displacement that is required for lets say muscles, because the polys aren't there.
Pretty much in other game engines they use decals when a rocket hits a wall ya have a big black streak, what valve is doing they use a displacement map in the same way.
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