[PythagoRascal]

As far as I know they are using a customised variant of the "wave-function collapse" technique, used and popularised by Oskar Stalberg in his games "Bad North" and "Townscaper". The technique boils down to hand-crafting tons of tiles with adjacency rules about which tiles can slot together. When the user adds/removes a tile the algorithm iteratively tries to find fitting tiles and, if needed, changes neighbouring tiles for ones with the best transitions. He gave a talk where he goes into detail about this[1]. You can also find more if you google his name and "wave-function collapse". [1]: https://youtu.be/0bcZb-SsnrA