Also worthy of note, the ponds do not interact well with fog.

Any presence of fog makes the ponds turn black and behave bizzarely:

http://steamcommunity.com/profiles/76561198085714902/screenshot/700660773127733455

This may or may not make sense.

This issue reminds me of the issues with A2 bridges that span water...

I have a gut feeling that the root cause of the problem is something engine side, that freaks out when you push a p3d object with roadway into the ground.

For bridges if you adjust the roadway PERFECTLY, so it lines up with the road that it joins, then the issue goes away.

OR, you can create an invisible road above the bridge, and as long as it does NOT MAKE CONTACT with the bridge, that also makes the issue go away.

See this video for an example of the invisible road working as a fix for the A2 bridge issue: https://www.youtube.com/watch?v=KJLck9o0wug

I BELIEVE, if you do not allow the pond object to penetrate into the ground anywhere, it will work... but have not tested it myself.

A good way to test would be to make a cube shaped small pond, place it next to a wall or stairs, so that it is not touching the ground, and then walk/fall into the pond. Normal swimming should work.

IF it does work, then IMO the best solution would be to create "pond bottom" models that can be sunk into the terrain but have a given size/shape above ground to receive the pond object on top of. This way, you blend with existing terrain, but do not have the pond object and the terrains collisions interacting.

Also if that works, it should make it easier to trace down the root cause of it engine side... Some sort of up spike in geometry or collisions is being created when two objects touch and are over or next to water (similar things happen on Cherno Docks, and Sahrani nabrezi objects)

It's the same zoom.. the pictures lack perspective

http://puu.sh/4wRSR.jpg

http://puu.sh/4wRV1.jpg

the top of the chrome window is at the roof of the stand in both pics and the arrow is pointing to the same level IE top of Hesco Barrier

Did op change resolutions and not restart?