Could the pulsing water texture be a stutter, or a texture loading issue related to the the line in the .cfg file that is this;
"Texture_Bandwidth_Mult:40" Maybe you need to bump it up to 80, 120 or higher?
But it somehow sounds more like it can't make up it's mind what texture it wants to use. In which case maybe deleting the original texture would fix it?
I'm just learning all this stuff so don't listen to me, just trying thoughts....
FS9 on an Asus Z96j Notebook
Intel Core Duo T2500 2.00ghz
ATI X1600 (256)512mb