salva: in and out of the lake eh? the sylex manual states that the water will be at z position 0! i had this problem too so basically align ur water plane so that it is on z position 0 and move ur terrain or level geometry up or down to adjust the level of the water. also, i noticed that it doesnt matter what action that you apply the slx_water to, the water will always be a flat plane stretching out into nothing like seen in my pic. i assigned it to a small cube and got the same result as assigning it to a flat model with 4 vertices and 2 faces.

ornll: im just using the default code from the sylex manual, i am using all of the default settings used as an example in the manual.