Okay wow, a ton of comments! : )
First off, anyone having issues with underground mining,
try pressing 'c' and hope that one of the resulting slice views is what you want.
Everyone else:
The waterplates can be found in the upper reaches of the universe.
Look for tiles with no grass on them.If you stand in the center of a growing stem,
it will carry you to the top as it grows.
There are a ton of bugs with that,
and it is possible to be buried inside or even cloned.
I also find in some situations that
removing a bud from a tree causes all sorts of ugly problems.
On water behavior:
My water simulation is very, very primitive,
in order to not cause terrible lag.
There are a ton of shortcuts taken,
which compromise the water's actions in horrible ways.
For instance the choice of where the water particle will go is often not very logical.
The way they repel each other also
makes it difficult for water to spread out into level caves and tunnels.
There are like a dozen different rules with water behavior,
and some of them are tied in to the erosion behavior.
If it wasn't for random rolls preventing the water from being fully active at all times,
it would move a ton faster and smoother, but in biased directions,
and each frame would take near a second to draw on a standard rig.
Anyways, I have added a toggle,
and the ability to change the draw distance in Orange mode.
So now you can just shrink the draw distance to a manageable size,
and if that doesn't work, just disable the textures altogether.
I'm really pleased with the textures,
but sometimes I think the flat shades look just as pretty.
EDIT:
You can also zoom in and out with 'u' and 'o'.
@timmeh: The ground is hollow underneath
because I haven't added in the rest of the rock layers yet.
I'll probably hold off on that until after I have my 3D map carve working better.