You just have to be careful with water+meth never to run out and forget to refill it. Also, there are threads discussing how injecting too much water may have caused cylinder wash and oil starvation.
The most intriguing thing about a motor like that to me is the redline... match it up with a huge turbo and you'll not only be making 500whp, but you'll be doing it in a 4000rpm-wide usable range... that my friend, is
! So I say, go for it!
Also, have you considered what other mods you have to make to have reliable 500whp?? (i.e. transmission and driveline...)