1. Water will be fixed so it will flow, but that's down the road.
2. The reason why you crashed while in the server was because of a connection problem. This could have been caused by a loss of packets from the client to the server or it is more likely the case that there was a hiccup in Paul's internet connection.
3. I assume you reached the very bottom of the world where there is dirt. I think it was intentional to not allow jumping on the layer and it is most likely Paul being a bit of a troll rather than a bug.
4. I personally like slowing down when I look down/up. It helps me build things without falling off of my structure and I feel it is a little unrealistic to be in a full-on-sprint while looking straight down anyway. But, I do see why it could be an annoyance, especially when I keep in mind video games are not made to be realistic.