Ever since Adobe got their act together with the Photomerge function in Photoshop, it has been my default for creating panoramas.  Previous versions were a little unreliable but they cracked it a few versions back and I have not changed my approach since.  However, a recent bit of YouTube exploring has changed that again.  Russell Brown had a series of videos on making panoramas from aerial shots and, while I was watching them because they were aerials, the stuff he came up with on stitching panos was actually more useful to me.

Instead of using Photomerge, he uses the same functionality of Photoshop but in individual steps.  The technique involves opening all of the shots as layers in a single file (something you can do straight from Lightroom which maintains the re-import linkage that I like about Photomerge).  Then you select all layers and use Edit>Auto Align Layers.  This gives you the same options as Photomerge.  Apparently, according to Russell, if you have a series of shots where you have rotated position but are looking horizontally, Spherical works best.  If you are looking up or down, use Circular.

The result can be quite distorted if you use Circular but it will all get better soon.  If you aren’t happy, you can undo the step which is a lot easier than starting from scratch which is what you would have to do in Photomerge.  Once the alignment is done, Edit>Auto Blend Layers while take care of the rest of the stitching and blend everything together nicely.  It defaults to a Panorama blending option.

With the blend done, flatten the layers and open Filters>Adaptive Wide Angle.  This will default to a panorama setting and, if you have the distorted output from the Circular settings, now you will suddenly see everything come back to what it should be.  You can tweak this filter to get verticals and horizontals aligned as you wish and then you end up with a good pano output.  Some cropping and filling of blank areas with Content-Aware fill and the job is done.  I shall be taking this approach for all my panos from now on.  If you don’t use this approach already, you might want to give it a try.

Also, you can go to the original source on this and check out Russell’s videos on YouTube.