Altitude is set by the aircraft and shown on your controller as height above take off point. NOT above the ground below it. It will not climb or descend related to the ground under it.
Answers to you questions in order you asked:
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If you just follow the altitude number on your controller as you try to fly over a slope the peaks at >400 ft (or any flight altitude) you will hit the side of the slope.
Answers to you questions in order you asked:
Yes
No
If you just follow the altitude number on your controller as you try to fly over a slope the peaks at >400 ft (or any flight altitude) you will hit the side of the slope.