Not only can we simulate water physics with AI, but can also generate foam, spray, and bubbles as well since 8 years ago. Since then, new research has come out that takes into account individual bubbles' behavior and densities, allowing them to coalesce and better interact with one another.
"Constraint Bubbles and Affine Regions: Reduced Fluid Models for Efficient Immersed Bubbles and Flexible Spatial Coarsening" by Ryan Goldade, Mridul Aanjaneya, and Christopher Batty:
https://cs.uwaterloo.ca/~rgoldade/reducedfluids/
