I think the title says it all pretty well. UAVs use AGL altitude reference even internally, and try too hard to be exactly at the commanded altitude. This cause (as far as I've realized) two problems:
1st case.- for fast moving UAVs (MQ4A Greyhawk and similar), when you command one of them to loiter over a target which is around hilly/montaineous terrain, the UAV goes abruptly up and down as it flies over peaks and valleys, trying to maintain its (AGL) height. It becomes extremely hard to precisely aim the camera in such conditions.
This also happens with the slow movers but is way less problematic because most of them can stand still like a helicopter at a given position and altitude.
- case- for slow moving UAVs (AR-2 Darter and similar), the problem is that they try to correct such altitude on its way to the commanded target, and makes them even to stick for long minutes in a very short part of the way because it loses a lot of time going up and down.
This also happens with the fast movers but is way less problematic because they do it very fast