Are all the photos and speculations well based?
No-body has yet mentioned the s- word.
As a competent competitor to the 1200GS, the Yamaha is definitely attractive, and might in future take a significant bite of 1200GS sales.
Despite our own Advrider interest & bias toward dual-ish purpose adventure-tourers, the lion's share of sales of an all-rounder like the 1200GS, definitely go to riders who stay on-road 99+% of the time. Sure, these riders may have a touch of RTW fantasy lingering in their minds, but Pavement Performance is where they're really at.
Power is seductive.
And a bigger (slightly) engine and a 25% power-to-weight advantage over the Yamaha, would be a good attractor of sales, lifting the BMW into a "higher bracket" in the minds of potential purchasers.
130-ish horsepower could also claim some sales from the Multistrada 1200.
(Nice as it is, the Multistrada is still very much the road-based bike. Borderline wheel-travel [170 mm] and a laughably small 17 inch front wheel [without availability of dual-purpose tires] eliminate 90% of its all-rounder capabilities. But it is stylish, has a trendy & slightly off-road Name, and above all - is powerful.)
Water-cooling is useful for Power. Emissions benefits are probably a very minor consideration.
The traditional boxer air-cooling has much to be said for it.
But, with a well protected radiator, water-cooling has a great deal to recommend it - also, it hasn't put-off R800GS buyers.
The boxer design is actually well suited to "hybrid" cooling - sufficient finning over the cylinders' water-jacketing, can permit a smaller radiator : and perhaps even allow "limp-home" capability (if coolant loss occurs).
And here with a strikingly new design, is a face-saving opportunity to re-do some of those components to the rear of the engine, and overcome past "non-problems".