So I've spent a little time coding the past couple of weeks and this weekend I buckled down and implemented tile edges. Please excuse the lame-ness of my artistic tile skills, that will get less contrived. Hurray!
Currently sand overlaps water and grass overlaps water and sand both. The hills and mountains already had a grassy texture of their own.
Making progress! It's looking a little more like a game and less... clown barfy. Still needs work though on some of the details.
Also added clipping for drawing the tiles to help with performance. May or may not matter though.
Also the new texture images: