from rules of golf:
i) A ball is considered in the hazard if any part of the ball touches the hazard line.
(ii) If a ball is deemed lost in a water hazard, REASONABLE EVIDENCE must exist that the ball was lost within the hazard.
OPTIONS:
(i) Play the ball as it lies within the hazard without penalty.
(ii) One-stroke penalty and play the ball at the spot or as near as possible from where the original ball was last played.
(iii) One-stroke penalty and drop a ball behind the water hazard no nearer the hole on an imaginary line with the hole and the point where the ball last crossed the margin of the hazard as the endpoints of the line.
(iv) Only if the player's ball is deemed lost in a lateral water hazard. The player may with a one-stroke penalty drop a ball within two club-lengths no nearer the hole from the point the original ball last crossed the margin of the hazard, or at a point on the opposite margin of the hazard equidistant from the hole.
In general, WGT defaults to (iii) if the drop point isn't OB or in a hazard; occasionally it'll give you (ii). It won't let you play it as it lies (i), to my knowledge. I'm not sure why it rarely gives you option (iv).
I believe the weeds and water along the sides of some KI fairways are a lateral hazard. Course committees also declare some options for relief 'off the table' as impractical for speed of play or player safety; such exceptions are on a course by course basis, so what's true for KI may not hold true for other courses.