OBGE Liquid Water is the fruit of the project centered around replacing Oblivion's water shader, as there were several limitations in the game's water rendering techniques that made it so the game's water did not look as good as it was capable of.

Now, five years after the game's release, the first candidate has been released, and it looks incredible!

...But, there's still some problems needing addressing. I am looking off toward the Skingrad vineyards in this shot, and as you can see, they have been flooded. I told you all that rain we get in this game would do something li...

Whoah! Bloody hell!

Yeah, still needs some work. Problem is, this problem is going to be kinda difficult to fix, as Liquid Water doesn't use Oblivion's normal water rendering techniques. Even then, this is a problem that might not even be possible to fix, as avoiding Oblivion's hardcoded water rendering means the only way to fix this would be to rewrite the code if they are not willing to hook the new shader into Oblivion's water. Quite a shame, really. As it is, the water is only really good for screenshooters.

I'll stick with Enhanced Water for now. It may not look as good, but at least it maintains the immersion.

How the heck did it manage to flood the vineyard?

Because the shader isn't capable of getting the water height for the cells surrounding the one the player is in at this point, so it assumes that all of the water is at that height at the time.

The team is working to fix this, though. They're going to try hooking this shader into Oblivion's default shader so that Oblivion, but until then, there's not much that can be done about that.