MC-230472 was resolved as a duplicate of this issue, so I want to say that this does not only affect height levels, but the water overlay will also not render at the side of flowing water.
this has been a thing for years, this is well known and has been used in hundreds of speedruns as well, look through the speedrun.com Minecraft 1.9- 1.15 submissions where they use it to find ocean monuments shipwrecks or so they don't pass by the stronghold when boating, it's not hurting anybody so its not likely to be patched
This has happened for a while now