Physical Water Surface

Yes I ended up moving all my world objects up to match the waterplane at Z=0 so all is good now.

I can confirm that the objects behave normally once they settle down, sometimes they fly up in the sky twice (first on spawn, once again when they touch the waterplane) but will eventually behave normally, kind of weird to explain.

EDIT:
One more issue I just remembered was when setting Follow Camera=true in my game, when switching from Third person to First person (this simply moves the Spring Arm to 0 for first person) my FPS would be cut in half, I ended up moving the water plane Scale and Position to a timer based event instead of tick