Since the bug of the water generating around Ocean Temples was fixed, I made a world to take a look, I discovered that no water generated, actually, a forest did. I tested this with Deep Ocean biome and the Frozen Ocean biome. At first I left the Ocean Monument to 'yes' in the customization menu. That's when it happened. Water level was set to '1'. In the pictures are the seeds of the worlds I tested on. In the FrozenOcean biome a kind of Forest/Taiga something appeared to form.
Deep Ocean Seed: -2237070983244950429
FrozenOcean Seed: 70814820975513480898
UPDATE: It seems that this bug does not affect 1.8.2-pre6 and earlier.
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I was talking about the frozen ocean. The deep ocean generation in the screenshot is strange and I agree that its also a bug.
Ok, I'm a bit confused by your description. Does "Water level was set to '1'." actually mean you made a customized world and set the sea level to 1? In that case this is working as intended, that's the purpose of the sea level option.
The bit about snow generating isn't a bug; that's just the level decorator treating the frozen ocean as a big island due to the low water level. However the rest is.