Hi guys,
something I haven't been able to figure out from your blog - are you maintaining a separate mesh quadtree for the water?
I'm guessing your logic is if the min height of the main quadtree is below sea level, consider the water quadnode valid. If the waterquad node needs splitting, split and apply the same logic to the children. Otherwise just draw it.
In other words, you maintain two mesh quadtrees - you don't hijack the main height quadtree to draw water patches?