TD, Guys,
What is it precisely about waterfalls that should preclude them from a golf course? As Rich and others noted, if it is only kosher to incorporate features endemic to an area into a course, most of them would be quite drab.
It seems to me that if the client demands a certain features after consultation with his hired experts, it is up to the architect and contractors to incorporate them as well as possible. If there is some elevation and slope to the land, water will run-off naturally, and perhaps it would only take some exageration of what's already there. The par 3 #7 at the Hills of Lakeway (Nicklaus) is a beautiful hole, which looks natural, and the water fall in conjunction with the wind dictates the play.
Where I have problems with a water fall is when the budget is tight, and building it results in cutting corners on other more critical areas (such as drainage, irrigation, contouring, feature shaping, etc.), when it is superfluous to the design of the hole (little impact on shot values), and when the feature looks very artificial. An example of the second is the water fall at Texas Star (Foster; I think #16, par 3) where one has to look toward the tee from the green to see it; and of the third, #2 at Austin CC (Pete Dye) even though it comes directly into play.
So Tom, if the client wants it after deliberate consultation, build it as best as you can. You could provide him a hard copy of this thread, but I doubt that it would have a major impact as we are not very representative of the average golf consumer. In any event, after Red Raider, you are no longer a minimalist. You seem to be to be practicing what Mike Young is alluding to in another thread, augmenting what nature gives you in each unigue region or locale. I see absolutely nothing wrong with this approach.