dear fellows,I beg to differ...
it doesnt show the condition of engine.It just indicates that fule-air mixture is inright proportion.The engine may well be excellent but water comming down the exhaust pipe alone is no indication.Other may rectify but i have seen few messed up engines with blue smoke and water comming together.
SO if you have doubts about your engine,Rev it up to see if smoke comes out of engine.If you can seebluish smoke that goes a long way...Your car's engine needs attention.
In shot,water simply means good fuel-air mixture to burn.
Hope it helps.regards