True. As far as I have experienced, this is more of a glitch rather than a true bug. For instance, you will momentarily be able to see the terrain beneath the darkness at your old location (on the new map).
Once you plop down your capital city, I believe everything returns to normal (graphicswise and otherwise).
Another smallish glitch is I can't bring up the menu (where Regenerate is found) the normal way (its button is missing while in the advanced start mode). I can only regenerate the map by pressing escape to bring up the menu.
Lastly, if you begin spending gold in the advanced start mode, and discover your position isn't good enough, can you then Regenerate with a full load of money? This to me feels slightly abusive.