I was blown when I found out that liquid can be drank in the holodeck, and went down a rabbit hole where I found out that modern holodecks have replicators built in, and mix/match when to create real water, and when just to simulate a virtual (but hard) liquid.

Whenever you see a waterfall in the holodeck, it's likely just rendered scenery until you interact with it, in which case they switch to using a replicator to give the real effect.

TL;DR -- Video game mipmapping hasn't changed essentially