I guess this is a divisive film because of how differently people are going to experience it. From the criticism that you have levelled against this and The Hateful Eight I get that you find the use of well known story devices, and in-movie references to real-life movie-making cheap and contrived...I guess to the point where the 4th wall is broken and you're no longer engaged by the story.
I can definitely understand that, and I feel the same way about all those big budget action-films which is why I don't bother to watch them anymore, unless I'm taking the kids or it's a franchise that I have an inexplicable affinity for (Like Planet of the Apes ... I said inexplicable, ok)
I think Guillermo del Toro is, despite his rejection of Catholicism, still a very Catholic storyteller in that (in my opinion) he mashes a bunch of things together and expects that through magic, the components will become more than the sum of their parts, in much the same way that transubstantiation turns wine into the Blood of Christ.
And also a Catholic storyteller in the vein of the magic realists, whose work I can only assume you hate - Gabriel Garcia Marquez and Isabel Allende, etc. That South American lyricism and mysticism allows for stupid, stupid things to happen in stories - ghosts and demons and really childish, supernatural stuff. Stuff that seemingly doesn't belong in the realm of adulthood, with our Complicated Relationships and Layered Emotions. But the appearance of these things - and in the Shape of Water it is the Fish-man - allows for topics that ordinarily bring a story to a standstill - topics like death, like deformity, betrayal, abuse, these topics roll in and out of the story at a pace that is more akin to real life, which ends up making the emotional rhythm of the story more in tune with someone who has a real life.
In an everyday conversation, nobody wants to spend 20 minutes delving into the multifaceted reaction you have to being dumped, or having your mother die. They ask "How's your mother?" or "How's Joe?" and you tell them the truth, and 5 seconds later they're talking about the half-price paint they bought at the hardware store yesterday and how they would love to have coffee with you at the new place by the library.
The Shape of Water does this with The Fish-man and The Mute. We don't want to acknowledge a lot of things about this relationship, because it's uncomfortable. The fact that intimate relationships are often basic and animalistic, and despite our best attempts to mask that fact with conversation, at their core, they are about needs for sex and touch and we are prepared to accept those from places that are shunned and feared by society at large, if that is the option that presents itself to us. Those are truths filled with shame and sadness for a lot of us. It's a lot of human "stuff" to cover in a story, and it could be so heavy and intense and draining. But because the story presents them so playfully, with such far-fetched characters and situations, it's digestible and actually...it's entertaining, even.
One of the reasons I love Guillermo del Toro is that he does that old-fashioned cinema of spectacle stuff. I love his stuff because I know if I see his name, I can get ready to forget about the real world for a bit, but will still resolve a couple of emotional bits of crap I have going on, while I watch (because of those devices he uses, I mean, because of the way difficult things affect fantasy characters). There's a lot of forgiveness involved - it's not like watching some meticulously planned Wes Anderson film. There are lots of dropped balls and awkward things that don't work, but the effort he puts into presenting and exploring real human pain and confusion with fantasy and spectacle...I don't believe anyone else really does that. Not like him. So I forgive all the other stuff.
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