"This is Water" is a 2005 commencement speech by David Foster Wallace (video, transcript). Wallace's argument is that a liberal arts education is valuable because it teaches you how to think, which helps you notice your default state of being so that you can act with understanding of it rather than acting like a fish who doesn't know what water is (thus, "this is water"). It was an interesting discussion, but I think that it ultimately misses the point. The problem is that he tries to extoll the virtues of virtue while being value neutral.
One thing he argues is that "The only thing that's capital-T True is that you get to decide" what to believe. Well, the first issue with that is that it contradicts the crux of his talk: that people have deeply ingrained beliefs that come from things external to themselves. If his argument were true, then the apple would fall far from the tree. The second issue with this notion is that it isn't as meaningful as it could be. He's framing the decision of what to believe as the axiomatic center of his beliefs. Since it's axiomatic, any other choice would be just as arbitrary as that one, but it falls prey to another theme of his speech: the idea that he is at the center of the universe. If I didn't think of myself as the center of the universe, then I might believe that "human suffering is bad" is the only thing that's capital-T True. I also happen to think that denouncing human suffering is a more useful belief than exalting choice. The third problem is that he says in his speech that it's arrogant and bad to believe for sure that something is true, but that appears to be his opinion on choice.
He then argues that "there is actually no such thing as atheism" because "The only choice we get is what to worship" and "choosing some sort of god or spiritual-type thing to worship" might be good because "pretty much anything else you worship will eat you alive." He's being a bit imprecise here. He discusses a set of ethical principles as a part of spiritual-type worship. Ethical principles need not be spiritual, and materially informed ethical principles (eg, notions of human suffering or consent) are probably less paternalistic and more valuable than spiritually informed ones. It's the difference between claiming to do something because you think it's good for someone else and doing something because someone else actually wants your help. Similarly, ethical principles need not involve worship. Principles don't need love or ceremonies; they should just be followed.
Wallace's follow up to that is that "worshipping" money, beauty, power, or intellect will make you unhappy, not because they're bad, but because "they're unconscious." There is research to suggest that things like selflessness and charity make you happier. So, in that sense, I will say that yes, worshippnig money, beauty, or power would be bad even if it weren't unconscious. And it's not just bad for you, but also, more importantly, for everyone. Similarly, religious worship or worship fo plenty of non-religious ethical systems can be just as bad if they don't come out of an attitude of selflessness and charity. Even selfless ethical systems can cause harm if they're overly based on spiritual rather than material principles (eg, the idea that being gay is bad for the person who is gay because of some divine principles). And making ethical actions unconscious is extremely important! Look at organ donor rates: in countries where it's opt-in, the highest rate is around 30%; in countries where it's opt out, the lowest rate is around 70%. If you would rather something more spiritual, a goal in some schools of Buddhism is to make your following of the Four Noble Truths unconscious (you shouldn't desire to believe in them, because desire will lead to suffering). So no, unconsciousness doesn't make a thing bad, and consciousness doesn't make a thing good.
The important thing isn't looking aronud and recognizing the water. The important thing is rising up, taking a breath, and swimming towards the sun.