I have reproduced the complete text of the section of C. Marin Faure's book 'Flying a Floatplane' (3rd edition) below that the ATSB report extracted it's 'turn towards land' from. I have added emphasis to a number of statements which I beleive resulted in the loss of the author's context as a result of short extract used by the ATSB.
FLYING FLOATS IN LOW WEATHER
Low-weather flying, or "scud running," is as potentially dangerous in a floatplane as it is in a landplane. Continued flight into marginal VFR or IFR weather conditions is the single greatest cause of general aviation accidents. Never allow yourself to be pressured into flying in weather you're not sure you can handle; however, there are times when low-weather flying can be accomplished in relative safety if you follow a few basic guidelines(Fig. 21-10).
Always fly within reach of a body of water large enough to land on. the protected waters of Washington's Puget Sound, the Inside Passage to Alaska, and the lake country of northern Minnesota, Manitoba, Ontario, and Quebec are examples of areas where your flight will probably carry you over more water than land. The advantage of being over or near water is that should the ceiling really start coming down, you'll be able to land quickly and wait until the situation improves. Obviously, the water you're flying over will have to be smooth enough to land on. Water covered with swells or the open ocean are as inhospitable to your floatplane as dry land, and you should think twice before attempting to cross them in marginal weather. The greatest hindrance to visibility along the coasts of British Columbia and southeast Alaska is fog. Fortunately, the presence of fog usually indicates an absence of wind, so the water is generally smooth enough to land on, unless it's exposed to ocean swells. Don't fly over unfamiliar territory in low weather conditions. Patches of fog or mist can hide the terrain around you, and if you don't have a good mental picture of the area, you can easily become disoriented. When flying over water, always keep the shoreline in sight, but leave yourself enough 'room to make a l80-degree turn toward it if the visibility ahead of you drops below minimums. By turning toward the shore, you always will have a visual reference to help you maintain altitude. If you turn away from the shoreline, you'll instantly be confronted with a featureless, gray void. You'll have nothing by which to judge- your altitude or the airplane's attitude. The chances are good that you'll stall the plane or enter a spiral dive, but you'll have no idea what's happening until a wall of water suddenly explodes through the windshield.
If the visibility drops to less than two miles, slow down. Give yourself an additional margin above a stall by lowering the flaps to their normal takeoff position, and slow-flying along the shore. By reducing your speed, you'll have time to react if a rocky bluff suddenly looms out of the mist ahead of you or if you see that you're going to fly into a fog bank.
A very dangerous weather condition is created when rain starts falling in an area where the temperature and dewpoint are very close together. A mile or so in front of you, the rain might obscure the horizon, but you'll have no problem following the shoreline beside your airplane. The danger occurs when fog forms in the rain. The fog up ahead will look just like the rain, so you'll have no idea it's there. Then, bang! You'll be in it, and your visibility will drop instantly to zero. The shoreline you've been following will disappear, and you'll have no visual reference to help you turn the plane around. If the atmospheric conditions along your route are conducive to weather like this, be very, very careful. It might be better not to fly at all.
Low-ceiling weather tends to concentrate air traffic, so turn the landing lights on and keep a sharp eye out for other aircraft. You never know when someone might come barreling out of the mist toward you, so be prepared to take evasive action if another airplane should suddenly appear.
Keep an eye on what's going on behind you. I can't imagine a worse situation than being forced to turn around by fog or low clouds, only to find that it's socked in behind you, too. If you do find yourself in this situation, the best solution is to pull the power off and land, assuming the water beneath you will permit this. Once you're safely on the water, you can beach the plane and wait for the weather to improve, or you can shut the engine down and drift. Be careful that you don't drift right along with the bad weather.
If your problem is a local fog bank, and you know there is better weather on the other side, you can land and taxi your plane until the visibility improves to the point where you can take to the air once again; however, keep an eye on the engine temperature gauges. Some planes will overheat if they're taxied for a long time, so you might have to shut down occasionally to let the engine cool off. Also keep in mind that taxiing for long distances on the water will throw a monkey wrench into your fuel consumption calculations, and you might need to refuel sooner than you had planned. Unless the conditions are absolutely ideal, don't taxi on the step. You won't be able to stop or turn quickly enough to avoid a collision if a boat or a floating log appears suddenly in your path. If you do step-taxi, watch those temperature gauges.
If the water is too rough for a safe landing and you can't go back, the next alternative is to climb. As long as there is fuel in its tanks, your floatplane is safest in the air. If you've received sufficient training to allow you to climb, cruise, turn, and descend on instruments, you might be able to climb above the fog or low clouds to better visibility above. Once you're there, try to establish contact with a flight service station or an air route traffic control center for assistance in establishing your position and setting a course for an area with better visibility. This is an emergency situation, and it emphasizes the importance of sticking to familiar territory when flying in low weather. If you don't know exactly where you are, and you don't have a good mental picture of the terrain that surrounds you, you could climb blindly ahead into the side of a hill. You'd be better off trying to put the airplane d.own in the fog even if the water is rough. Your chances of surviving a capsizing are better than your chances of surviving a head-on collision with a mountain.
Offshore I have experienced conditions where there is no definite horizon and the sky blends into the ocean even though it is legally VMC. On one occassion that stands out there was 15km+ visibility due haze and over a 3,000 foot cloud base in the early afternoon but no horizon.
Glassy water, certain rain sizes falling on water can deceive even experienced seaplane pilots in regard to both height perception and aircraft attitude (interference with ability to discern a horizon).
The risk of disorientation is high when scud running over water, particularly where the pilot does not have the experience or training to recognise some of the unique illusions and threats that this practice creates.