Ok, here's an idea (which you should try instead of reinstalling the SDK!). If you're using env_cubemaps in your level they can make it look strange if you don't use them fully.

Place an env_cubemap above your water's surface, as well as a water_lod_control somewhere, and obviously make sure all sides to your water brush except the surface is the nodraw texture. Compile, and run it in-game with the console. When the map has been loaded, type the command buildcubemaps to, er, build your cubemaps. This should make it look lovely; if it doesn't, use a different water texture and try again! (the blue canal water one looks great and doesn't need this above process)