I'm one of the Merfolk in SL. I have a "brother" avatar (biped) who is looking to get a stilt home. The depth of water under the houseboats is deeper than under the stilt homes and is level. The sea floor under the stilt homes (that I've seen) is sloped. I was able to create an underwater home under my houseboat (pic below). I couldn't do this under a stilt home. But I am really looking forward to visiting the waters around stilt homes. It just looks awesome. So I agree that a region with stilts, houseboats, open water, and any other water themes could be a great place for underwater citizens.