Here are a couple of environment images I did for the project I was on at Blitz in 2010. The interior image was a paintover of a placeholder game model. This is a process that we use alot these days. Usually you will start out with a few quick thumbnails and then move on to a slighly more detailed rough image. This will be enough for the modellers to go ahead and build rough environments for gameplay testing. Once everyone is set on what the final scene should be then the concept artist can take back the model (usually a screengrab from the in-game engine or from Maya) and do a paintover, fleshing out the scene and adding lighting and surface detail. It is an incredibly useful process both for the concept artist and the modellers.
The exterior islands shot was all just done in photoshop. Once again custom tree brushes do a good job of adding detail quickly. In this case I set up a layer with the trees on it then linked a fresh layer over the top and used additnal foliage brushes to add detail and colour variation. Once again I doff my preverbial cap to the genius that is Mr Steve T for his gorgeous cloud brushes which really finish off the image so well.