I have tried both. I prefer the way the que comes out when using water. If I plan on running 265 or less I run water. Any temp over that is hard to achieve with water.
I suggest using water at first and then experiment. I found no water seemed to make a "dry jerky like" bark I didn't quite care for on some meats, mainly ribs.
22.5 Weber Kettle - 18.5 WSM - Maverick ET-732