Start a battle, any battle. Then move the mouse over the button in the upper right corner. This will cause a horizontal row of buttons to appear pointed left. Move along that to the left end and another column of buttons will drop down under the display options button. This is where you can change all the lighting and color options.

I recommend you start with the Load Preset button. This will bring up a choice of 4 lighting schemes. The one in the upper left is the default, so ignore it. The 2 with the gray water are the same except for different sizes of bullet holes and scorch marks, so pick one of those for a daylight scenario. The one in the lower right, with dark water, is the same as those with gray water, except it looks much better at night. Anyway, pick one them as a starting point. This will put all the various sliders in decent starting positions.

Now use the other buttons. One is called Ocean Advanced Dispaly Options. This one has a bunch of sliders where you can vary everything about the water (and it also has some effect on the sky, too). You can change the color, lighting, the size and shapes of the waves, etc.

The Miscellaneous Advanced Display Options mostly affects ships, but also has some effect on the sky. Here you can change all the lighting and shininess of the ships, as well as how much they bounce around in the waves and also the size and opacity of the bullet holes and scorch marks.