Yes, you can now set water at altitudes above 0ft. However all the water can only have a slope of 6ft. For lakes this is no problem since you can set them all to the same altitude. For rivers, well it is difficult since water can only drop by 6ft over a length of 5280ft. So rivers that actually hook up to water still roughly need to be at 0ft alt.
Lakes at altitude will definitely be used in the SEA.