Analyzing National Elevation Dataset DEMs in ArcMap 10

When conducting analyses with National Elevation Dataset DEMs, projecting the raster correctly is key, otherwise you could end up with slopes greater than 1,000,000% or slope/aspect/hillshade outputs that look like this:

Using the "Project Raster" tool, the first important piece is to output the raster to a projected coordinate system. NED DEMs come from The National Map with a geographic coordinate system, and the linear unit is undefined. If you do an analysis on a raster that requires the use of a z-factor, outputs can look molten or overdone and the resulting cell values can be extreme. Projecting to a projected coordinate system defines a linear unit, avoiding this problem. See this blog post from ESRI for more information.

The next important piece for projecting the DEM is to use a Bilinear interpolation for the "Resampling Technique". ArcMap defaults to a nearest neighbor resampling, but if you do this and subsequently do a slope analysis on this raster, you often see strange grid lines show up in your output (as in the photo above). Selecting BILINEAR instead of NEAREST should avoid the grid-like artifacts that stem from resampling patterns.