I'm pretty sure this is the blood tile, just hued to a blue color. I've done this before in the past when doing an Atlantis dungeon. It was the only way I could make a water tile that was see through, and able to make a player pass through.. Works great for this kind of effect. Although it does also look like they're using higher resolution art work for stuff like the grass, or it could be that I've been staring at the screen for too long.
Just create a new item, set it's itemid to that of the blood tiles you wish (there are edges, solids, even moving versions of it.) Make sure you find a good blue hue to set it too, and probably set the name to Water. Then you're good to go. If you still can't figure out how to make it, let me know and I'll dig through my old files to find the tiles I used to do it.
To be honest, I'm not sure why they bothered adding stuff at the bottom of the water there. Other than for the realism effect. Unless that stuff under the water is frozen to the map, it's a waste of statics.
Also, to go for the whole under water dungeon feel. You can create dungeon walls, and floors that are similar hue. To make it look and feel like you are submerged below the water. Plus by doing it like this, you could even do the whole Spongebob thing and have water under water! =O