Sounds like you've not setup the physics right. My guess is that the trees are actually staying where they are, but the water and your character are dropping down (actually, did you attach the FPS controller to the water?).
The FPS controller script needs to be attached to an actual character, and make sure that the trees and water don't have rigidbodies attached (although they'll need MeshColliders).
I got the same problem... I use the first person controller but it just falls through the ground and the camera got some weird things going on with its rotation.....
Is there a nice beginner tutorial for the solution to this problem, I just want to make a walking around in an envirnoment demo??? Help much welcomed! ;)