2D contours from terrain file

I'm curious about the result you're looking for in making 2D graphics?  Is this for plan sheets or larger roll plots?  You could clip the external areas of the terrain so there's not as much to process to prevent things from bogging down.  I will say, rather reluctantly, it is possible (not recommended) to reference a 3D file containing a Terrain set to a Contour Feature Definition into a 2D file and "Merged to Master" (right-click option on that 3D reference).  It generates 2D graphics (line strings) as raw graphics.  It generates so many vertices it may or may not be any less boggy...  Obviously this route would completely remove any rules or dynamic nature to the proposed and or surface you've prepared.  You may look into a process of showing contours on terrains created like these series of videos Bentley has uploaded recently... https://www.youtube.com/watch?v=LkYCKozoNoo where contours are shown integrated and dynamic to a design (using terrain filters that read corridor break lines).    

Edit: One of the best practices to speeding things up in ORD is file federation, breaking things down into smaller chunks (reduce the "wave" of processing in each file).  If that terrain is too large, try clipping down the terrain to smaller terrains where it seems logical.  That way when one sheet file opens its not loading the entire 3 miles.  A terrain for each of the 4 models. 

Its for roll plots. The 3D graphics slow it down considerably.

You might try this workflow:

1. Create new 2D dgn
2. Attach terrain as reference
3. Merge to master
4. Use drop element command on terrain graphics.

Thanks!

Good summary to my rather lengthy discussion.  Thanks Marcus.