One of the drawbacks to using most propane tanks is that they were never designed for the type of heavy flow that we can and sometimes do put them through.
Tanks were designed for safety in mind. When the Department of Transportation came up with the requirement that all propane tanks must have an OPD (Overflow Protection Device)
What happens is that as you use a propane tank in a high volume application, you get a demonstration of the venturi effect. As the gas passes through a narrow orifice, it tends to cool. The consequence is that the tank starts to cool dramatically and begins to frost up. Depending on how quickly you drain the tank, it can start to ice up as well. The problem is that as the tank cools down, the propane becomes less efficient at off-gassing, which means you get less pressure out of the tank.
So if you plan on using a high volume of propane for your job at hand, you are going to want to think of a way to warm the tank up. So putting it in water helps to prevent the tank from freezing up
You can also use the water (if it's slightly warm) to estimate how much propane is left in the tank
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