Hey there, Brian!
Long time for me looking through T5, but I was pretty immersed at one point. The entire procedure is to designed to go from the Very Big (World Triangles) to the Very Small (Single Hexes) without much Referee effort. Here goes.
Keep in mind that the Local Hex you're populating is a 10km hex (not too big -- 65km sq. or about 1/2 the area of my home town of Tacoma, WA), and the Single Hexes (1km each -- even smaller) within it are entirely dependent upon the terrain type of Local Hex they inhabit. Once you have the terrain type for the World Hex, you can populate the Terrain Hex. Once the Terrain Hex's terrain type is determined, you can populate the Local Hex, and so on to the Single Hex.
This all starts with the World Triangle. Once you've populated all your World Hexes in your World Triangle by using the random determination procedure shown on Page 49, you will use that information to populated the Terrain Hexes within the World Hex, and those will in turn allow you to populate the Local Hexes and the Single Hexes that they contain.
That's how you populate a Local Hex: figure out the terrain type of its parent (Terrain and World) hexes, use the lookup table and use D66 for placement of icons as-needed.
1) Generate the World Triangle to populate World Hex terrain types (p. 49)
2) Use the World Hex terrain type to populate the Terrain Hex (p. 51)
3) Use the Terrain Hex terrain type to populate the Local Hex (p. 53)
4) Use the Local Hex terrain type to populate the Single Hex (p. 55)
Now, how do you place stuff within the non-World Hexes? Here's an example. Let's say I'm populating a Terrain Hex based on my World Hex having a
City (index number 51 -- all types are listed in a dice-driven lookup table on Page 38, and by their index number on page 47 -- these are index numbers in the lookup tables and not die roll results). I look up
City on the table on Page 53 and it says after noting that if this is a Hi or High Population World you should place two City icons in White Numbered Hexes (WNHs) and place Suburb icons in the WNHs adjacent to them. Determine the placement of the City icons within the Terrain Hex with a D66 roll and then draw in Suburbs in the surrounding Terrain Hexes. Terrain Hex is now done with a City (or Cities) placed in a Local Hex (or Hexes) with Suburbs surrounding it.
Extending to the Local Hex, we look up
City (we already know the Local Hex is a City from the previous) and we see that
City means that whatever Single Hex you're at on the Local Hex map, it's also
City, while the BNHs are "other". In this case, "other" defaults to Clear, but you can do whatever you want because it's your game. Industrial waste pits are nice, for example. Perhaps some greenspaces with gardens sacred to the locals?
Good luck!