This is simply anecdotal, but my experience with waterbirth and tearing was positive. First birth: semi-reclining in bed, pushed through crowning (my bad!), large 2nd degree tear, plenty of stitches inside and out. (Healed up fine, but took about 6 months to really feel comfortable down there again when it came to, er, fun stuff.)
Second birth: labored and crowned in the tub, much smaller 2nd degree tear with option to skip stitching altogether (opted for the 3 stitches for health reasons). DS was 2 lbs. 8 oz. larger than DD, had shoulder dystocia, and I birthed him with a dr.'s hand inside me to guide his shoulders through rotation. So the smaller tear is pretty amazing, imo. Healed up to the point of comfort during intimacy by week 5 PP, maybe sooner but I was feeling paranoid after last time so we waited a bit.