So I started to mess around and add something more than just grass, decided to try water. I started off by simply changing every block that was under a certain height range to a WaterTile, which in the first screenshot consisted of just a sprite change to a kind of underwater sand type tile.
After this I added the water at waterlevel. I decided to try and make the water transparent dependant on it's depth ... but it didn't turn out too well and looked too blocky. I think I might be able to get away with doing it like this if it were more blended (less variance in alpha amounts) but I decided to scrap it all together and see what it looks like if the entire water was the same alpha value (75%)
Although it looks plain, I decided to keep the water as one alpha value, it serves its current purpose (which is to resemble water) and looks decent enough. I randomised the seed to grab some extra screenshots of different areas, to see what the water looked like.
From these screenshots I ended up getting some feedback from a friend, who suggested that the water level was too high (since it was at an exact block height) and looked like it blended with the grass too weirdly. I ended up lowering the water level 40% the block height and ended up with the below image











