Had this is issue several times now, and found out what the problem was for me atleast.
Under landscape -> Collision -> Object Type
If you created a new object type, for me “landscapeObj” , and assign the landscape to being one. The foliage tool wont recognize the landscape when its looking where to place the foliage.
Should set landscape object type to worldstatic seems to work.
Can always swap between when painting and when doing other things 