I hope you're still here, because I've got a perfect solution for you.
Use a sky that would blend well with your water texture. Cut your water apart into rectangles/trapezoids that surround a square in the middle (hope that makes sense). Make each rectangle more and more transparent, so what you end up with is water that gradually fades into full transparency off in the distance. Under the transparent water will be your sky, which should now blend seamlessly.
This still takes a bit of room to look right. Each rectangle should be at the very least 256 units wide. A difference of 50 in transparency per section should look about right.
Check out the CS 1.6 map de_plaka to see this technique in action. I also tried it in my map dm_blue_paradise, but de_plaka was a much better execution.