Originally posted by d¢:

You gotta look at what you're aiming the hoe at. It's designed to flatten ground at the same height that you're currently at, pretty sure, and depending on how much it needs to change, that will cost a variable amount of stamina, or it will not be possible and in which case you'll either need a pickaxe to dig down, or hoe to raise ground.

The "paved Road" is both in one: it raises ground and flattens the ground. - so when you really want a perfect flat ground, use this! When the flat foundation is complete you can use other tools to make it more natural.
Just try it out.