When importing a Quixel high quality it includes a displacement map but the Fab module imports the displacement as a TC_Displacementmap. However, it appears that the data is not a G8/16 but is rather RGBA8. So it seems that the import should be to a TC_VectorDisplacementmap instead of TC_Displacementmap.
Import any high quality Quixel to your project. Observe that the _H asset is all white. Open the _H texture and change the compression to VectorDisplacementmap. Note that the displacement now looks as it should.
Expected Result
The displacement map should be able to be used in tessellation but it can’t until you change the compression as indicated above.
Observed Result
Displacement map just is not working as expected after import from fab.
Posting to confirm this bug. Reproduces 100% with all Fab materials I’ve tested. By default, displacement maps are broken until the compression format is changed.