Remove Texture Portions

When playing games these days I try looking at them with great detail. Figuring out how they did certain things. Currently I’m playing a great game (Dark Souls) and noticed all the wonderful destroyed environments. One thing they do is have a wall with missing stones. How does one do this? I mean, I know HOW to, but what’s the best way? These are three possible methods. Do the experts use one of these methods or is there another way?

  1. Add texture to object
    Add displacement modifier
    Remove edges and faces once the geometry has been changed

  2. Add texture to object
    Go into texture mode
    Make cuts where you want the stones removed

  3. Make an array of stones
    Remove portions of the array where you want holes. (Probably uses a sh** load of geometry)

What do you mean? Missing as you can see through the hole in the wall, or crumbled stone? If it’s a hole in the wall, they probably just added a hole in the flat geometry of the wall, and normal mapped the texture to give it good light play.