Yes you can have Birds and Fish in the same level.
First of all, you do need to add a blocking volume to the top of your water so that the Fishes obstacle avoidance traces have something to hit, that’s how it works, you can make it pretty thin too.
Next look into collision channels, you can set up collision channels so that the blocking volume only blocks the Fish.
Finally in the viewport click on show and check the navigation box (or just hit “P” on your keyboard). If it’s Green on top of your water the Birds will think they can walk there. The Birds think they can walk anywhere you see Green NavMesh, you can get rid of green NavMesh with a “Nav Modifier Volume”
Hope that helps, sounds like its just a few setup steps.
Neat looking show!!! keep me posted on the project, I’d love to see what you put together. 