There's nothing about the water that will necessarily damage the barrel except as a catalyst for corrosion. If this were a semi-auto, especially one with a substantial magazine, I might worry that the barrel might get hot enough that rapid cooling might deform it, but if the coolant is being introduced in a uniform, linear fashion to a moderately hot barrel, it seems like it would diminish the possibility of uneven or contradictory contractions.

I do try to use convection to cool my barrel between strings. Muzzle straight up, bolt wide open.

As to what is too hot? If I grab my barrel and think, "Ow, that's hot," I give it a rest. If I grab it and say, "Hm, that's hot," I might fire another round.