What you describe is basically how I've been modeling so far. This works fine for simple planes, and for generalized geologic features such as folded rock units. For more complex structures (such as folds with curved fold elements) I've had mixed success with extruding along a path that represents the fold element. If the curve is too tight, I have to construct it in pieces and join those together.

I'll have to dig around in my version of CAD to see if I can do blended extruding. That would work really well for several applications I have in mind. Sometimes my polygons are really complex, and extruding with even a modest taper angle creates conflicting (null) solids.

I could just create topo contours with a smaller interval, say every ten feet instead of twenty, thereby making all the steps smaller, but that'd be tedious, and would result in a solid with too many verticies. Perhaps you are right about the original data, I should get the DEM's and start from scratch.