I did this with about a year of programming experience, and zero experience with hardware, and all for about $80. It helps that the Arduino language has a great IDE that takes care of compiling and uploading the code to the board.
http://www.arduino.cc is the main Arduino site. It has the IDE, documentation, examples, and links to websites that sell boards and accessories. Boards run about $35. Cheap and effective.
I would have done a simple setup that allowed the water to close the circuit, but the sensors are very sensitive, and would react to my hand being near them when there was no circuit. I don't know enough about electronics to explain why...
As far as communication goes, I have a simple LED setup, with rows of 5 LEDs indicating the water level.
http://www.adafruit.com/index.php?main_page=product_info&...
I personally know the guys running the store.