Had water births with all three of mine, one in hospital and two in birthing centres (MLUs). Pg with number 4 and couldn't consider not having a water birth, even though it means there is absolutely no access to drugs (MLU is twenty mins by car from hospital).
My first time I stayed on a bed for ages, but was hating it, just couldn't get into a comfortable position. Finally got into the pool (a big shamrock shaped thing with handles and ledges etc) and it was bliss - suddenly I could stretch when I needed to, curl up when I needed to, was warm, supported by the water, etc etc. Gas and air over the side of the bath, husband holding my hands (or rather I was gripping his), I was on my front most of the time.
The same for the second (except for a hairy moment when i overheard the new midwife tell the outgoing midwife that she had never done a water birth before...) and third was the best of all.
In each case I gave birth in the pool, on all fours, and turned around to be given the baby, which I cuddled in the warm pool, heaven. I got out onto the bed for the delivery of the placenta each time because it was a managed stage - and didn't notice anything going on because I was far too busy getting to know my babies. I tore with no 1 and 2 and not 3 - which I put down to being more relaxed and a quicker pushing stage.
(I also had pethidine on a bed for a previously known still birth - obviously horrid, but made far worse by being on 'dry land' and the yucky pethidine, so I do have something to compare water births to.)
The downsides are something I hear from other people -
Husband/midwives/the cleaners have told me that it looks like a bloodbath (ha).
A friends husband is 'hilarious' describing how the midwife gave him a fishing net to fish out any pooh (don't know if I did, I have never asked...)
It can slow things down - although I don't think that happened to me.
As I say - neither of the first two things are important when you are actually giving birth, you simply don't notice - and if it is slowing things down, you just get out...?
If you are the sort of person who loves wallowing in a hot bath, then I think it is wonderful. I have a friend who is a short shower active type girl, and she tried the bath and didn't like it at all. She ended up squatting on the floor...! You just don't know till you try I suppose.
The last thing to say is that I have been very lucky to have three water births with decent size and shape birthing pools. I have heard stories of girls who haven't seen the pools before they went into hospital, who have ended up in a small bath - not much good imho.