Players and objects that are otherwise concealed in the grass or low-lying ground cover should not be visible at a distance (i.e. when grass no longer renders). This works (albeit is not perfect) in ARMA and affords at least partial cover.
You can repro this with all in game objects. Personally speaking, given the potentially impact to performance, occluding players is more important than other in game objects or NPCs (animals).
In ARMA 2 and ARMA 3 the player is only partially rendered. With ARMA 4 likely based on the same engine this needs to be fixed for DayZ and ready on day one of ARMA 4.
I will note that I've previously logged feedback (2+ years ago) that is still not assigned with ideas on how to possibly improve the partial occlusion solution in ARMA. The issue with ARMA's current solution is that it only hides what is occluded but not pixels that are deemed to be visible. This results in blobs that are almost as easy to spot as the full player model.
I feel a more optimal solution would be to combine the existing ARMA 2/3 solution along with a blur/opacity for the remaining bits of the player's 3D model that are rendered as visible (i.e. not occluded). The amount of blur/opacity would be based on scaling the following parameters:
1) Contiguous size of visible blocks (i.e. larger contiguous/solid blocks that represent a player/object would be less "hidden")
2) Distance/weather
NOTE: Optics would have the benefit of effectively reducing distance
Obviously IRL the presence of grass and other ground cover ocludes at infinite distance while also providing "noise" makes picking out details such as an animal or person more difficult (i.e. because of the randomness). While this may be hard to achieve efficiently in a game I feel blur/opacity would at least allow for an analogous simulation of those impacts. Not perfect, but better than the current ARMA 2/3 solution that will no doubt be needed in an Enfusion powered ARMA 4 (not to mention DayZ).
To be clear, the issue with the current ARMA solution is the terrain texture is very low contrast and even partial occlusion of a rendered character model sticks out. As a long time ARMA/Operation Flashpoint player (i.e. since 2003) this is a must as while a stationary player may look like a rock, if they even slightly move the high contrast model against the low contrast ground texture sticks out far more than it would IRL given the high degree of noise/randomness imparted by the terrain covering.
NOTE: I feel a good bit of this could be extended to apply to bushes and other cover.
NOTE: While I stated player characters are priority one, I feel that NPC/animals would be second (especially chickens and wolves and small prone animals who are low lying).