This follows a standard 3-vanishing point system that an artist might draw consistent with an elevated. The water fall line should be from the middle of the opening and continue down basically along the leading edge of the support behind it.

The block before the wheel is there to give the water instant flow-rate. The water is going over a sill and powering the wheel. But what you are not seeing is that it is all on a massive obtuse angle. That is why the water streams down in a tight braided coil.

It narrows in not entirely unnatural, but for such a thing to flow unbroken in its fall would involve more fluid than appears to be in the system.