Except Looki's Background Offset shader is screwed up in 2.5, and he hasn't been around in months to address it. This is unfortunate because I was trying to do the same thing as the OP.
Come to think of it, the shaders have a few bugs in 2.5 in general. Hopefully they can be fixed.
That to me looks like the flag shader. I do something very similar with a waterfall in my game. You can trigger the effect parameters to be updated/altered as well so its not just a pretty static object lol. IMO once you learn how to use shaders and how they work they are one of the biggest improvements in MMF2/2.5.
Warmachine, the flag shader applies to the object's image that you apply it to, and doesn't affect the background. While you could put the effect on the whole frame, I would prefer using an object with a custom mask (such as the Background Offset shader, which is broken in 2.5) since I am using a separate shader on my frame already.
Perhaps the flag shader would be fine for OP's uses though.
That's what i mean, by using the flag shader on an object and not the frame itself you leave the frame open to whatever effect that you want. All you have to do for background is just put the water with the flag shader on the first (or whichever it is needed at) layer and you're good to go