Question referred to those crappy defects in clouds. . .Supposedly fixed in Bryce 5 (?)
No guarantee this works all the time but it helps most of 'em.
Don't be afraid to go into the DTE for this.
All the default cloud mats are very basic and need to be tweaked.
I used the Alpha channels only for this result.
Color can be changed by Alt+click on the color indicators in the Global settings (not in the A,B,C or D columns)
The only channel (column) I used here was A for the density of the volume.
But look at the Fuzzy factor. Cranked to max!
Hey! Cranked Fuzzy was a band weren't they?
Anyhow, fuzzy level makes stuff more transparent.
That's why the density will work at 100 in this case.
Edge softness blurs the harder edges a bit.