Okay, so I decided to take a crack at modifying one of the existing water textures and re-purposing it to act more like clean water. To some extent, it works, but theres an issue with my setup right now. For some reason the surface likes to act like a no draw surface, eventually blooming into a bright white surface, but then viewed more directly or while swimming in it, it returns to normal, though the reflections are difficult to see. Any ideas?

the images below aren't full render, but the idea is the same, since the surface carried information over from the wrong location.

normal

broken

Erm have you tried a custom water_lod_control?
It could be that the cheap render is like this and the expensive render like intended. You might want to try messing around with that

I currently have one set to the defaults, though I tried bumping the transition distance to 2000 and the complete transition to 4000.

I think it has nothing to do with water lod control.
You should try to check the VMT file again and maybe create a test map to find some things out. For example using hint brushes to split the surface of the water or split the brush itself. Sounds strange but sometimes it really helps.

Well, I'm currently messing around with different water approaches for my mappack. I'm sure you already read about the water shader parameters that Valve is using for creating the different toxic slime in Portal2, right? All the parameters this shader has are in here:

https://developer.valvesoftware.com/wiki/Water_%28shader%29

The same as skotty, I don't really think that has to do with the water lod control entity...

One question: are those both pictures the SAME water .vmt file? I'm asking because for my it has no sense. The 2nd picture looks like if you would have chosen a blueish $fogcolor but not in 1st pic...

Also your problem could be the refract/reflect setup, or the parameter $translucent 1 (or 0)...

Have you taken one specific .vmt from the game to change it? which one? Post the .vmt so we can take a look at it...

@Skotty: In reality, those are multiple brushes instead of a solid one, so that theory doesn't fit.
@josepezedj: both pictures use the exact same texture, so thats not part of it. Here's the current setup.

$forceexpensive 1
$normalmap "liquids/water_river_normal_sharp"
$flowmap "liquids/c3m2_hflowmap_a"
$flow_normaluvscale 155.0
$flow_worlduvscale 0.5
$flow_timeintervalinseconds 0.2
$flow_uvscrolldistance 0.075
$flow_bumpstrength 0.4
$flow_timescale 0.35
$flow_noise_texture "liquids/water_noise"
$flow_noise_scale 0.0005
$flow_debug 0
$reflecttexture _rt_WaterReflection
$reflectamount "1"
$reflecttint "{ 190 205 205 }"
$reflectskyboxonly 1
$reflectonlymarkedentities 1
$abovewater 1
$bottommaterial "my_textures/clear_water_beneath"
$fogenable 1
$fogstart 0
$fogend 200
$lightmapwaterfog 1

$fogcolor "{ 40 107 141 }"
$flashlighttint 1
"%compilewater" 1
"%tooltexture" "nature/water_frame01_normal"
$surfaceprop water

$pseudotranslucent 1
$waterblendfactor 0.30

I modified one of the underwater textures as well to adjust some of the fog.

$forceexpensive 1
$normalmap "liquids/water_river_normal_sharp"
$flowmap "liquids/c3m2_hflowmap_a"
$flow_normaluvscale 155.0
$flow_worlduvscale 0.5
$flow_timeintervalinseconds 0.2 
$flow_uvscrolldistance 0.075 
$flow_bumpstrength 0.4
$flow_timescale 0.35
$flow_noise_texture "liquids/water_noise"
$flow_noise_scale 0.0005
$flow_debug 0
$refracttexture _rt_WaterRefraction
$refractamount "0.25"
$refracttint "{ 151 135 34 }"
$abovewater 0
$fogenable 1
$fogstart 0
$fogend 2000.00
$lightmapwaterfog 1

$fogcolor "{ 10 107 141 }"
$flashlighttint 200
"%compilewater" 1
"%tooltexture" "nature/water_frame01_normal"
$surfaceprop slime

[Edit]
I narrowed it down to one of the textures that were in view. It seems that one of the no draw textures was messing with the surface reflections. This is strange though, considering that none of the other toxic brushes has ever had this occur. I'm definitely missing something in this equation.

Wanderer2021 wrote:
Here's the current setup.

Well, the only variables I think that could be messing up with your water look are:

• Your custom(?) texture "clean_water_beneath". Check out that. Try to substitute it for some other and check if it makes some difference. I don't really think you need a $bottommaterial if you want to create a clean water though, just remove that line and go changing the rest of parameters.

• Parameter $fogend in first .vmt. I think 2000 is far too much and could turn buggy.

Also, you may want to give it a look to this:

http://www.gamebanana.com/css/tuts/5156

Another possiblity is to use one of the older water VMTs of HL2 for example.