I am going to try your suggestion and report back. You do not need to turn Lumen off however.
Here is a good workaround:
set Shadows quality to LOW, it will make you possible to use Lumen for making your game, yet save your FPS - but be aware things will be a little bit more intense light without proper shadows
UPDATE: @Solarfly - I have tried your approach. It SEEMS TO BE WORKING, BUT: water is not visible.
The landscape terrain sculpt issue with the terrible stutter has been resolved however, the editor no longer freezes.
Can you make the water visible please? 
UPDATE 2:
Though placing rivers and lakes works only on one of the data layer proxies, on the second one I could only place lakes, rivers did not appear unfortunately.