Water is seen in every game. It is a small detail to add more realism to the game. Almost every town or city is surrounded by water, whether it be an ocean or lake. This exlcudes some places in the game, like Area 42.
If Crypto goes or falls into the water, he will die instantly. In the first game there is a glitch where Crypto can go into the water, only occuring in Santa Modesta. Any human that goes into the water will die too. This rule excludes pools, though. Despite some pools being very deep and the water deeper than Crypto, both humans and Crypto can survive standing in pools.