Hi Storebror,
you had right, I had water=4 in my conf.ini.
Setting it to 0 solved the problem.
As you say, this mod is a tremendous improvement in visuals at long distance. However, it has some issues that should be revised:
- It improves very much the visibility at long distance, although I think that the overall appearance is a bit too whitish, as in overexposed pictures.
- At least in my config, water doesn't look very good. It shows too rough reflexes and a geometric texture.

Some objects show changes in illumination that make them not to blend very well with the landscape (see the grey rectangle at the bottom of the picture). The white dots in the river are too invasive, too.

I've tried a stormy mission. Under non-extended graphics, the ground and sea are almost obscured by the heavy clouds shadows. However, using Graphic Extender, the sea shows reflexes as if there were no clouds at all:

Finally, I've observed that some objects are not concealed by the ground relief when flying at low altitudes. For example, in Reno map, which is quite hilly and has a lot of trees and bushes, the vegetation can be seen behind the hills as if they were transparent. I don't include pics because the effect is only noticeable when the image is moving.
Appart from these issues, it is a wonderful mod that can lead IL-2 to a new era!! Congratulations to Slibenli and Storebror for the hard work put here!!!