Go dunk your head! Seriously, you can see the effect in a pool - look at how well you can see things above and below the surface, go underwater, and open your eyes. Things will be fuzzier.

You're trying to reason away an effect that people actually see, and that you can verify independently. That's the opposite of how science works.

For a scientific explanation, my first Google got came up with this - an article about some kids who do seem to see normally underwater. It also includes this explanation for our blurrier experience:

When the eye is immersed in water, which has about the same density as the cornea, we lose the refractive power of the cornea, which is why the image becomes severely blurred