Yes, displacements are shown in reflections, although currently they may be somewhat simplified. For a mirror effect this may be an issue, but in most cases the water has a certain amount of roughness that makes it all but impossible to tell.
Displacements should certainly cast correct shadows (although not soft shadows), and you don't need to turn on "ray-traced shadows" for it to work. Those settings (in Clouds and Atmosphere nodes) are actually only useful for when you want the terrain to cast a shadow either into the atmosphere or onto clouds (depending on where you enable the setting). Under normal circumstances displacement will produce correct shadows by default. The entire terrain shape is created through displacement so this is a fundamental necessity.
- Oshyan