Quote: "rather some dx9 from 2000."
Find a game from 2000 with graphics like FPSCX10 out of the box.
Quote: "I cant find a way to make a simple flowing water (flowing down the sewer pipe) - if it indeed were dx10 then physics already should take care of most of it."
You don't believe this is DX10? Those physics need to be coded into the engine.
Quote: "In fact besides default water level (and i cant create different water levels per round), there is no water at all."
It's called FPI Scripting.
Quote: "I cant find a way to make dynamic shadows/lightning (eg light shining doesnt from a hole above, creating the shadows of the bars on the ground)."
Elaborate, please. Do you mean lightrays?
Quote: "Resolution is 800x600 (last time i used something at this reso was 10 years ago)."
Can be coded in with the modders' kit.
Quote: "Lightning is bad (besides few lights that just create a radial blob of light)."
If you want so much better lighting, code it yourself.
Quote: "Basically no shadows at all - and i set them on in the tab menu."
There are shadows, are you looking hard enough?
Quote: "The default water has its own light. Like creating it i na cavern or sewer room (with few crates above shining dim light down) - the water looks like big solid colorful block all across the room."
Mess around with the water sliders.
You get what you payed for: a below-entry-level DirectX 10 FPS creator.
I reject your stereotype of Wisconsin and, in fact, live in a city.