i think the problem is the clipping of the sides of the cubes. instead of using cubes, you should create one big mesh from the map data. i cannot tell you how to do it just now, but im sure there are many ways to accomplish this. if you can wait a bit, i may come up with an idea that works for you.
here is your function, but i canged the floor to planes instead of cubes. i don't know if this still works with your collision system or anything, but atleast the lines on the floor should be gone:
function placewalls()
tex=1
row=15
for y=1 to 15
for x=1 to 15
obj$=chr$(MapData(x,y))
obj=MapData(x,y)
if obj$="w"
make object cube wallobject,1
position object wallobject,y,0,row //x
texture object wallobject,1
//SET OBJECT TEXTURE wallobject,0,0
//set object cull wallobject,1
//test \/
// inc wallobject
// make object cube wallobject,1
// position object wallobject,y,1,row //x
// texture object wallobject,1
// set object cull wallobject,1
inc tex
if tex=3 then tex=1
inc wallobject
endif
if obj$="."
//make object cube wallobject,1
make object plane wallobject,1,1
xrotate object wallobject,-90
position object wallobject,y,-0.5,row //x
//texture object wallobject,2
//SET OBJECT TEXTURE wallobject,0,0
inc wallobject
endif
row=row-1
objecttotal = objecttotal + 1
next x
row=15
NEXT y
ENDFUNCTION
"It is only slightly easier than changing all sugar in a cake into stevia after it has already been baked" -Bisqwit