$%^%....13.04 blocks to be more precise so yeah, 14 when rounding up. There is the aforementioned issue with density of 128 or more making torque easier to achieve then speed so water with it's density of 1000. That formula I provided was correct, although I'm not entirely sure where you measure the dy from as I didn't investigate that bit it just needs to be 14 to achieve max power. The speed is 2x the fall speed after all, as viscosity of water is 1000 it cancels out so that speed of the engine is 2sqrt(19.62dy), as it maxes at a mere 32 rad/s you just need dy to be (32/2)^2/19.62 which is 13.04.
On a different note the engines don't seem to be chaining, a row of hydrokinetics in a row don't seem to be adding torque/power.
Three pictures for you to help demonstrate it, that is the minimum height needed for full power by the way, moving it one block lower lowers it to about 507kW.
Can you make a GitHub issue about all this?