I think this isn't intentional, but if you use the Medium Water Generator to generate MF from water, and use that MF to run a Generator, for example a Big Generator-S, than you have "almost" free power with only a little start kick.

yes, but produced MF is too less to be effective. It's more intended to use to operate machinery. But i will think about it and can reduce the temperature of output MF so its useless for generators then. You need a lot of Water-generators to get valuable power from it.