I don't know whether it's a good a idea or not, but my original thinking that you'd have enough water mass to diffuse the heat sufficiently fast so that the coating would not be be subject to very high temperatures at a given location.

Obviously the heat would have to transfer to the exterior environment in some way (e.g. through the floor) so this wouldn't work with smartphones.

It won't be safe long though, it'll slowly leach various chemicals out of the components. Eventually it'll form rust which will dissolve into the water and serve as an electrolyte, and then everything will go to hell in a hand basket quickly.

Distilled water is a bad choice. While deionized water is non-conductive, it can act as a solvent for so many things that almost any impurities it comes in contact with will result in the water being made conductive.