Looks to me like you fell through the world - there's distinct places in the world where that can happen.
One very popular spot is the exit of the sewers. In that case, it's a problem of CrystalSpace (key word: vertical portals), the engine that PlaneShift uses. It's known and "on the list", but it has a lower priority at the moment since PlaneShift is the only application of CrystalSpace that uses them so far, and the CrystalSpace guys are preparing for their version 1.0, so lot's of other stuff to fix
Summary: I'm afraid there's not much that can be done at the moment. When you exit the sewers, walk the stairs to the end (don't go over the blackish spots on the side) and you should be good. .)
