Yeah, I guess you're right. Even in the best environment they need to be a good 10-15 meters apart to entirely eliminate interference under all wind conditions. And that's modern high-tech ones. The kind of creaking wooden monstrosity the dwarves build would be lucky to power a millstone in the real world.
BTW in real world applications, by the end there they had waterwheels designed to operate in a variety of modes. Overshot, backshot, undershot, breastshot. Some "plants" could manage several modes, usually operating at different speeds per mode. The industrial revolution in the USA used breastshot wheels, but the more significant historical uses (like the romans) used dwarf-style undershot wheels.
Back to the water reactor, though, I'm with the idea that a simple fix would be to just have pumps pump less water per step - like say 1 zlevel of water. That would stall the typical reactor design, and it wouldn't require a complex overhaul of fluid dynamics in DF. I've used the odd hand pump in real life and it didn't risk flooding the region in five turns: DF pumps are crazily powered.
And why *should the dwarves be able to easily power something like a pump stack, anyway? Aside from that we have gotten used to it. It's not like they're
that high tech. If needs be you can always get half your population down there operating pumps.
Then why hasn't anyone built a real dwarven water reactor?
Irmo, running a line of undershot wheels down one bank of 2000 km of river isn't perpetual motion. Each waterwheel takes a negligible amount of power out and the river keeps on flowing. We can do this in the real world, although we never have as there's no point in having 2000 km of waterwheels doing nothing. And no it wouldn't back up the river.
We can't build a water reactor. Even if the design was 100% efficient and frictionless and never lost water it would at best only power itself, and even that would take crackerjack finesse to set in motion. And of course no real design can be 100% efficient. Dwarven tech would have a hard time doing 5%.