I think this would be a much better for the sake of convenience and not cluttering your inventory with a bunch of water bottles. My suggestions: (pick just one of these)

1. Water bottles should be stackable
2. Water inside a canteen can be smelted to make a clean water canteen
3. Ability to fill canteens with water bottles
   To balance this out, you can make the crafting recipe of canteens a little more expensive, if needed

I support these changes, perhaps some config options for individual options?

That would be nice, that way stacking water bottles isn't enforced for some people who still want the challenge. Also, these changes also apply to juices too.

Or how about making a 'filtering' canteen that would collect filtered water but would wear out and neer to be recombined with a filter to recharge?

That could be a great addition. I support your idea.