I suspect "flow like water" is Taoist in origin, referring to "the watercourse way."
This "way" is wonderfully described in the Book of Changes, where from we have excerpted a short commentary of Richard Wilhelm on the hexagram no. 19 - Lin / Approach:*
Quote:
The water endlessly flows and fills, up to a certain limit, the corners it is flowing through; the water is not "afraid" of any dangerous place, of any "falling" and there is nothing making it lose its essence. Under all circumstances, it remains equal to its nature.
Basically, I think of it as meaning go with the flow, you don't need to be unnatural, or resist excessively (think tiring yourself out by swimming upstream) to succeed at go. For example, if your opponent wants a moyo, fine. Take the generous cash gift he gives you, then gently reducing from outside should be enough. A dangerous invasion after taking the cash might be seen as not flowing - and could yield in a quick loss if it dies.
* rather than writing this myself, I took it from
http://www.taoisminfo.com/watercourseway.html
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- Brady
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