It looks odd when water lilies spawn in floating river water. They dig a hole in the water surface

I think they're being placed correctly at sea level, then after mapgen the river water starts to flow and flows around them, because they are nodes. This only happens at river mouths.

Yeah i don't know how to fix yet but will keep it in mind. I'm not sure it can be called a bug, more a request for better behaviour. Luckily it's rare.
Maybe remove them in floating water. There was a discussion to remove torches in floating water. I don't know what was the result of this discussion, but maybe it is a good idea to implement a generic system that removes specific nodes in floating water like torches, water lilies, mushrooms and so on
Yeah we might have 'on flood' callbacks in future, that would work.
Surely lilies should spawn on fresh water rather than salt. An on_flood callback would be useful.
Many Minetest lakes at y = 1 may actually be freshwater, default:water is not necessarily salt water, however river water certainly is. Spawing water lilies on rivers would multiply this problem, and some parts of rivers are unsuitable due to steep slope and 'fast flow'.
Yeah i don't know how to fix yet
Why not make those nodes floodable?
I would love to see that for grass and flowers as well.
Of course, duh, will do this. 'on flood' call back is not needed, flowing liquids will just remove these.
See #1170
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Yeah we might have 'on flood' callbacks in future, that would work.