Answer by Yofurioso

I think in order to make the atlas work properly you have to make your own mesh and UV unwrap it so that the mesh uses only certain coordinates of the atlas for texturing (I'm not sure if that came up right). Try this, use blender or 3dsMax or any other 3d modeling software and make a simple plane (4 verts, one quad), then unwrap it and then scale the uv layout so that the plane uvs cover only the grass texture. After that all you need to do is duplicate that plane as many times as you require.