What I'm more unclear on is how small the impact is. It seems very likely to me that throwing the waste heat into the bottom of the ocean has less of an environmental impact than running A/C to suck out the heat and dump it into the air.
However, is the impact really so small that you wouldn't notice it just meters away? That's the part I'm unclear on.
But the efficiency gains are such: Air conditioning is actually inefficient, especially with air cooling. Water cooling is more efficient. Water cooling traditionally uses water as an exchange medium, but is eventually water-cooled-by-air anyway, just in bigger batches. Here, they can take in new cold water and throw out old hot water without actually bothering with any air exchange at all. Or at least, that's the plan. Maybe it'll work!
(If "nobody cares because energy is cheap", we wouldn't have tried this in the first place.)
That's a false dichotomy. More energy-efficient CPUs don't preclude efficiencies from cooling.
I suppose the case could be made that CPUs account for the vast majority of datacenter cooling needs and that ARM efficiencies would eliminate so much of that need that any efficiences in the cooling itself would not be worth anywhere near this kind of cost. I'd expect some pretty extraordinary evidence backing up that argument, since those would be pretty extraordinary claims.