ok... 100% the problem is just the fact that you are moving automatically.. pathing coding aside, the easiest fix for "walking through the ground when feared" is simply removing the "walking" part of it...
just change fear to making the target cower in fear IN PLACE. No movement, no potential for Terrain issues.
fixed, Done, moving on.
look, i know they could possibly fix the terrain systems, but that effort in coding is better spent on a much larger number of fixes, like also looking into the GBCs on templar abilitys, or horse tripping.
the ideal fix should be the most simple one, one that fixes the problem asap, allowing for future developing into the original root cause if more similar issues arise.
anyways.. this change should be easy.. NPC fears already exist that just do this... just remove the current runny effect and replace it with that... some times Code Copy and Paste is the best solution if you know you have a working system elsewhere.
I play every class in every situation. I love them all.