If you are ASKED to Disclose water problems with the house, then it's your conscience as to what you say. However, as Deanna put it, what would you do if you were the buyer? After all, your 'version' of the water problem is not necessarily how someone else would 'minimize/maximize' their description.
From what little I know, if the basement is as you describe where it's 'normal' and liveable, then I think it 'smells like' a prospective owner would question it. Also, a prudent prospective buyer would have an Inspection. In short, you can take your chances and ask the Realtor to have people WRITE DOWN why they don't want the house. Tell them you want the potential BUYERS to fill out your own, special form asking why they don't want your home. IF it turns out that the basment is an issue, you can get an estimate or 3 about what it would cost to FIX the problem, then work with a potential buyer about negotiating the expense. Maybe they'll pay 1/3rd and you pay 2/3rds. Maybe 25-75, or 10-90. No matter how you slice it, get the BUYERS to tell you why they 'passed' on your home.
My best to ya and hope this helps.
Jay J -MOderator
PS: Here's a sample form for your buyers:
Welcome to Lana's Mom's house! Please take 2 minutes to fill out my survey ...
1) What DIDN'T you like about my Mom's house? ________________________________________________