Can someone verify if this issue has been resolved in AC 4.0?
Copter-4.0 does not support terrain following in Guided mode. This has been added to Copter-4.1 though (PR is here). We are still a few months away from starting the Copter-4.1 beta I’m afraid so it is currently only available in “master” (aka “latest”). In general we don’t recommend flying “latest” because although it is generally safe it can have issues.
Thanks rmackay9 for your reply, and thank you for working on this issue!