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In my texture you can clearly see the 'grid' the textures are on. How do I create a seamless texture that does not have this repetitive pattern in it?
The whole idea of my engine is for the tile's grid to be somewhat transparent to the player.
This is an example from my tile engine I'm still working on. :D
Make several different grass textures, and make either the map editor randomly pick the grass textures, or make the game pick them at run time.
Don't know if this will be of any use for you but have a look at image tiling without seams.
BTW, Paul Bourke's site is full of really interesting stuff (if you don't already know of it):
http://astronomy.swin.edu.au/~pbourke/