Correct me if I'm wrong but the way a water cooled system works is based on a heat exchange system. Kind of like the way a refirgerator works. My point here is that if it's a heat exchange system, one of the components in the system is going to build up some heat, that component is usually meant to be stored outside of the case so that it's not adding heat to the system. That's why refrigerators and A/C units have a part that needs to be outside, or have a ducting that runs outside. Otherwise they'd be wasting their energy trying to cool the air that they just heated up.
Yes/No??
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