In my search for water physics in game engines for our boat designers I came across updates to the open source Ogre 3D engine (now in Direct X also I see). Anyway, it visually looks impressive:
http://www.youtube.com/watch?v=NLD1k0SHow4&feature=related
some more effects: http://www.youtube.com/watch?v=woHZRUlOQqo
a programming book (with worrying reviews): http://www.amazon.com/gp/product/1590597109