Water source blocks in the latest snapshot act as individual blocks it seems, because as you are underwater and begin to swim up to the surface, you do not drown. This can easily be reproduced by jumping down to the bottom of an ocean and begin swimming to the surface. But if you are at head level with a water source block, however, you do begin to down.
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I can also confirm this behaviour. Standing still in water does still drown you, but going up and down replenishes your oxygen level completely.
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http://i.imgur.com/M063ze8.png
I searched first but couldn't find this bug report.
I made a few testing chambers that make it easier to fix your vertical position with your head (or whole body) in water. It looks each water block has a "breathable zone" running from ~.0 to ~.45. It seems to get overridden by another water block's non-breathable zone if the player's head is in both, so for a water column it's more like ~0.2 to ~.45.
I comfirm. (unlimited respiration)