The red appeared to be in the water only for a split second, and then everything was clear again. The kind of transition you're proposing would surely take longer.
Not necessarily. The brain pattern-matches continuous sensory experiences to something already known, which is discrete. I tend to think about it as rounding-to-nearest. Blood gradually transforming into water before your eyes doesn't make sense to the mind.
This is a kind of "X files" thread.
Post experiences which spooked you, which made you doubt reality, mathematical or physical laws, your sanity, memory or perception. The more improbable the better, but no second-hand legends please, share only what you personally experienced. If you had the event later explained rationally please use rot13 to avoid spoilers.