If an area of liquid is fully under blocks (I used carpets in the example but does the same for solid blocks too) and there are blocks that are 0.9 pixels tall around it, the liquid does not render. In the example on the left, the 2 blocks of water are covered by a block and there is farmland to the side of it, and you cannot see the water at all. On the right side, however, there is carpet above just one of the two blocks and you can see the liquid in the empty space and under the single carpet.