I think the problem isn't so much creating the water effects (sinking ship or not for example), and rain just needs to be a graphical effect plenty of games have done - although all sorts of rain on all sorts of worlds, different liquids, different gravity, different atmosphere, that'll get interesting. It's generating it convincingly. Randomly generated terrain with a fixed sea level isn't too hard - that's been done plenty of times, but if you want rivers and so on, calculating where they go on the fly (too many worlds to predefine them all), giving tributary systems that don't cross each other, convincing variation in size, working out where a lake actually is - that all sounds like quite a challenge. A very interesting challenge to be sure, one that sounds like it would be very interesting to work on.
Chucking plants and animals on top of that's the easy part, although ideally you'd want to procedurally generate all of them too to give each world unique lifeforms.
Yes, fixed water level is very easy (this is how most games do it), but proper water levels and rivers and tributaries etc... is borderline impossible with PG worlds that need to be updated 60 times a second. At least I can't think of a way of easily doing it.
Rockstar has billions of pounds and thousands of employees working crazy hours for years and years and years.This just furthers my feelings that if a gaming company can't compete with Rockstar, they should do something else
You can count the gaming companies that can compete with Rockstar on the fingers of one hand.