The picture (
[First flight, 120 feet in 12 seconds, 10:35 a.m.; Kitty Hawk, North Carolina]) does not appear show too much shoreline and what seems to be waves is in reality small sand dunes, but again you have to study the entire large size 17.2 MB TIFF and not the small formats or just cropped images because they can be misleading.
What I see on the large format picture is, from left to right,: (1) large distant sand dunes, the horizon line is not visible, (2) a zone that appears to end at the horizon, a lot of small sand dunes, like waves, can be seen stretching from relatively close to the foot of the hill to the horizon line, there can be water in the distance, it is not clear, (3) an area of sand that ends in a long dune situated far away close to the horizon.
That thing that looks like a possible ship on smaller pictures is in fact placed on that long sand dune (3) so, most likely, it is a building or a tree.
The Atlantic ocean would have been about 2.5 km away (see:
http://goo.gl/maps/d76bt ) supposing the place, where the photo was made, was correctly located many years after the event and the two brothers flew in the direction indicated by the alley.