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Does the source engine use Parallax normal/bump mapping? or atleast
something with Parallax in the name :p

*** Yes.

From what I can gather from these two links and some of my own knowledge:

http://www.gamedev.net/community/forums/topic.asp?topic_id=220134
http://www.opengl.org/discussion_boards/ubb/Forum3/HTML/011292.html

Parallax normal mapping is what the Unreal devs reffere to as "virtual displacement mapping" and my point is; Source has it. Although the new HL2 screens damn well don't show it.
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