I've got to a similar stage - i.e. successfully made one 10' x 10' area of scenery in southern England (roughly 18 km x 12 km at this latitude). I'm using a resolution of -1 in FSET and levels 9, 11, 12, 13 & 14 for the whole area (as opposed to different areas for different levels). FSET seems to take a couple of hours to produce the .bmp images and geonconvert takes about 30 mins to do its job. I had previously created a small test area a few km away and, like the OP, I copied the new larger area into the same folder as the smaller area, choosing to replace files with the same name. When I selected "Location" in FS2 I could see the new larger area but not the old smaller one.
Reading this thread it seems that I might be able to solve the problem by putting the different areas in different folders. I've noticed that many of the geoconverted files have another companion file with the same name, except for "_mask" at the end. What is the purpose of these mask files? Do I need them? Could I dump all tiles in the same folder if I got rid of the mask files? These mask files don't seem to exist in the default FS2 or DLC scenery.
Many thanks BTW to all who have made the this possible - whoever wrote the Wiki, whoever produced the video I watched & the help tools I used.