Water, shadows, visible light, reflections etc has always been something that raytracers have shown off, and something that poly based 3D graphics cards has always struggled with and only now are doing estimations of this.
By their very nature, estimations will always be faster than mathematically correct versions of the same thing. If you can get the estimation to look as good (or better in some cases) than the "correct" version, then it would be foolish to choose the slower version.
And regarding shader vs. raytracing - here's a raytraced version of water:
And here's a pixel shader version of water:
"Correct" isn't always "better" in computers. The real world is so extraordinarily complex, the only truly "realistic" way to render something would be to simulate every photon and it's effect on every atom. Until that's possible, shaders are not only faster, but in some cases more visually realistic than raytraced objects.