As far as ive seen through the tutorials, as one way of doing it by a dev, is :
Put water surface asset under the ground, as a square of material you lowered a bit under the ground. Then use height map lower terrain tool to lower the specific shape or a spot of the ground bellow that. Have water surface seemingly fill the space you "dugged out" or actually lowered beneath height of the water surface.
Of course you need to choose appropriate water surface type, so its a standing still water or waving or rushing one.
- I think you can actually increase or change the size of the water surfaces, just as you can manipulate other tool or assets sizes.
But im not sure about it or how much can you change those pieces without distorting something in them.
- all that and some other pieces in this video.
Its not on Larian youtube channel, btw.
http://www.twitch.tv/larianstudios/c/4542850