There is no 'literal waterboarding scene' in the theatrically released Shrek. In the scene you've seen, unless you're deep into dubious fan-remakes, Gingy 'just' gets dipped in milk (mostly off-screen) by an executioner-style heavy, then Lord Farquaad taunts them with their torn-off legs, which suggests legs-first dipping, not the head-first submersion that is the entire point of waterboarding.

Still pretty bad (even though the gingerbread buttons were apparently spared), but... not literal, and not even figurative, waterboarding.