Yeah, we're talking about a maximum of a few hundred Maiar with them, so we need to have places of residence for each of the Valar, with enough space for their "folk".
Yes I think that the waterfall effect looks good but we should probably avoid that.They are "walls" with a "door".
Beyond that, who knows.
Edit: the old depictions of Arda as a boat (with Taniquetil as the mast). Would tend to suggest that the seas are contained, rather than spilling out into nothingness, though. But that was an old idea abandoned long, long before the Hobbit was ever written.