MeshTool cannot do sub-meter elevations right now.
DSF2Text cannot currently do sub-meter elevations due to limits of the tool (not limits of X-Plane), but it -can- do sub-meter elevations if you are passing elevations via a raster DEM file and not per-vertex data.
You would do this by using scaled raster data over a smaller vertical range - if you don't need 65k meters of elevation range, you can scale down the vertical span to get better resolution, and use the scale and offset parameters of RASTER_DATA to specify how the data is mapped back to floating point in the sim.