Describe the feature you would like to see.
There's a few things I think the grave needs in the context of water mechanics.

1. The grave should be waterloggable; this will make it stick out less.
2. The grave should sink to the bottom of the water body.

I won't be adding the sinking functionality in the context of lava.. that's just too evil lol.

Waterlogging has been added in b2061b9 and will be released in the next update.

For now I'm going to work on implementing waterloggable. But the sinking mechanic will likely be a config option that's set to false by default when I do implement it.. mostly because I realized there could be situations where a player could die in a deep ocean (by a drowned, for example) and struggle to retrieve the grave due to lack of breath.

A sinking mechanic has been added in b852d47 and will be released in all of the 1.19+ updates. It also allows sinking in air and lava.