The water section of the Stronghold 3 editor is good for making impressive rivers, seas and moats. Additionally, it is relatively easy to use. For sea, you must ensure that the box "use sea" is checked, this will then turn the entire map into sea. The "sea level" is responsible for how high the sea is, a negative level will mean that you cannot view it, and a positive level above 100 will mean it starts to come off the place your map is made. In this screenshot below I made the level at 1700 and the result was quite suprising!
There are some additional settings for the sea as well - such as "extends to infinity". This is a pretty pointless setting since it only sends sea off the map. But it can be useful if you want sea to be at the edge of the map rather than the current border around it (when you play). By clicking on the down arrow next to "shader properties" you can alter some settings about the sea.
Next, the sub-menu to add rivers. The Tile Painting mode allows you to paint the river, and you can adjust the brush size accordingly. The Flow Editing option allows you to edit the direction the river faces, the decoration option allows you to place a waterfall and the viewing option will allow you to just view what you have completed without tools interfering. The final section allows you to paint moat. Moat is painted in exactly the same way as river, but is slightly different:
In Stronghold Crusader 2 moat has not been included. Therefore, you have the ability to instead use either "River" or "Pond". The difference is shown below.