Kelley - I have had a lot of success using a tarrain as the water surface rather than using a flat plane. Reduce the height of the terrain to the height of the waves you want to simulate and also adjust the scale of the terrain noise to simulate the radial size of the waves and then apply your water texture. I also find that using "fake fresnel" (shader-ops) or even the "proximity" (shoestring shaders) options to adjust the transpacency of the water with a separate terrain underneath makes for some awesome looking water. Best of luck to you and I look forward to seeing what you come up with!