A rupee dive can only be done with a blue rupee or higher. The quickest way to spawn one is to dig up a patch of dirt close to the dive spot, but one will not always appear.
Once a blue rupee appears, use the gale boomerang to bring it to the ledge near the entrance of Lakebed Temple. Take out the sword, hold Target (sometimes helps get a better camera angle), and press B a split second before you get the rupee. The timing is hard. If you swing your sword too soon, you'll get the rupee in midair and the animation won't happen to where you can dive out of bounds. However, this is easier than standing on the very edge, not swinging your sword, and hoping the dive works. From there, swim your way into the tunnel.
Swim to the middle of Lake Hylia where the floating wooden platforms are located. Get on one of the platforms and use the Gale Boomerang to bring a wooden box to you. Get on the very edge of the platform, and prompt Midna. You drop the box, which will then push you off the wooden platform, causing you to cutscene dive out of bounds. From here, swim your way into the loading zone.
Swim over to the GCN left side of the entrance to the temple between the large blue pillar and the green pillar. Position yourself so that the yellow arrow on your mini-map is pointing GCN north-west. You can use the Iron Boots to get into position and then take them off to make it a bit easier. Hold the Target button, and swim straight upwards. You should clip through the blue pillar and be able to swim into the loading zone without having to blow up the rock.
The Pillar Clip method can be done without Zora Armor or the Air Replenish Trick by sinking to the bottom of Lake Hylia while it is under twilight (requires Early Master Sword). The clip through the pillar and reaching the loading zone before you run out of breath is extremely difficult.
If you've obtained the Master Sword early, it's possible to skip past the windy underwater portion of the first room by save warping.
From the end of the bridge, pull out the Gale Boomerang and target the collumn towards the left side of the door and do a long jump attack. From here, climb onto the fallen boulder, and target near the torches on either side of the door and use another long jump attack to reach the next plaform.
Get on the end of the bridge and use the Gale Boomerang to lure a Helmasaur towards the edge of the above platform. Once he is near enough to the edge for you to target him, do so, and pull out you sword. Back up a bit and do a long jump attack off of the Helmasaur. If he is too close to the edge, you will have to wait for him to turn around otherwise your jumpslash will bounce off of his armor and the recoil will prevent you from landing on the platform. From here, turn into a wolf and climb to the crest of the fallen boulder. Align yourself, and jump to grab the ledge of the next platform.
One time consuming task that occurs in the Lakebed Temple is emptying your bomb bag of normal bombs so to obtain water bombs from chests. Instead of throw the bombs into a body of water, head over to one of the waterfalls in the stalacmite room. By standing under the water while trying to pull out bombs, the bomb's fuse is put out immediately allowing for incredibly quick disposal.
From the entrance to the swiveling staircase room, head over to the top of the staircase and pull out the Gale Boomerang. Target once just right of the chandelier on the ceiling and twice above the overhang on the right. Long Jump onto the staircase's banister, and then to the ledge. This is a lot faster than have to move the staircase multiple times.
It is possible, using long jumps, to get the clawshot much earlier than was intended without ever having to go to the second floor of the dungeon and change the water level. Go to the hanging platforms room and run to the ledge of the top platform. Pull out the Gale Boomerang and target above the doorway on the left. Use a double long jump to jump to the hanging platform, and then to the door.
After doing the above trick, you can get over the railing in order to get to the deku toad faster. Jump on top of the chest and pull out the Gale Boomerang. Target between the pillar on the left and the stalactite on the right. Now simply use a long jump to get onto the railing and blow up the rock. _If you have gotten the Ball & Chain early, use one more jumpslash to get past the previously mentioned pillar, and you can use the Ball & Chain to break the rock if you don't have water bombs!
After entering the Deku Toad's chamber and triggering the battle, run around the room and kill the tadpoles that the deku toad shakes off of it's back. After it then jumps up into the air, run out of the way and wait for it to crash down and reveal its tongue. Target it and throw the Ball & Chain. When Link pulls it back to him it should finish the toad off.
By doing 2 LJAs (GCN Only) in the western gear room, you can reach the chest containing a heart piece without having to change the water level/activate the gear.
Drop down into the center of the key room, and head toward a patch of vines. Once you're standing next to them place a bomb behind you and Vine Clip through the wall. This can be done even if the water level has been raised by using Water Bombs and Iron Boots. Once you clip out of bounds, you must un-equip the Iron Boots by equipping an item over them.
Once out of bounds, equip the Iron Boots to sink below the floor, then swim toward the GCN left side of the pillar in center of the room. At the center, the game physics will start to behave erratically. If you pass underneath some open floor, the game will try to warp you back in-bounds. This is useful for getting high enough to reach the boss room trigger, and can even put Link back in-bounds inside the small room behind the boss door. Once you're high enough, head to the center and drop down. If you don't have the Zora's Armor, it's highly advised that you equip the Iron Boots before dropping into the Boss's Room as you will drown just before you reach Morpheel if you don't equip the boots before you surface.
For the first phase, Clawshot the eye then do a quick-spin to finish off it's first form. On it's second phase, start off by setting up the Air Replenish Trick, and float upwards with the bomb for as long as you can before releasing it. If your within range of Morpheel's eye, equip the Iron Boots and Clawshot onto it. Hit it four times with your sword, then un-equip the iron boots by swapping a different item over them. This will cause Link to let go of Morpheel, and avoid being launched up in the water. Repeat for the second cycle, but this time talk to Midna when you take off your boots. Instead of sinking down again, target Morpheel and finish it off.