Megalania can clip inside walls by using the Climb ability

There is a specific vertical rock wall on the mountain at the boundary between Green Valley and Dried Lake.
At this location shown in the attached screenshot, Megalania can clip into solid rock terrain when activating the Climb ability.

This bug creates severe unfair balance issues for PvP gameplay. Players who exploit this glitch can hide completely inside rock geometry, fully concealed from sight by outside creatures. Opponents have no way to see, target or attack the Megalania trapped within the wall. The player inside the terrain can freely wait for targets to pass by and launch unexpected ambushes.

Worse still, if fights turn against them, the Megalania can stay safely hidden inside terrain to recover health without taking any retaliation. This completely negates normal hunting and combat rules. Any player aware of this spot gains a massive, unearned tactical advantage over players who do not know about this exploit, ruining fair combat encounters. Screenshot of the location is attached for reference.

Travel to the mountain border between Green Valley and Dried Lake, navigate to the rock wall shown in the screenshot.
Use Megalania's Climb ability facing this wall and fine-tune position, the creature model will penetrate solid rock and get inside terrain geometry. Once clipped inside, the Megalania remains hidden within the rock while still able to attack external creatures.
In-game coordinate reference: (X=85474.190492,Y=158047.354575,Z=5608.98887)

Megalania should only climb along the outer surface of rock walls. The model cannot pass through solid rock and clip into terrain. Terrain collision should block the creature from entering inside rock geometry.