Both saved characters. Level 47 Nord and level 2 Imperial. If I enter water that is too deep to walk in the game freezes. I have deleted the game data and re-installed, but that didn't work. I doubt Gamestop will let me exchange disks, so looks like no more Skyrim for me.

Really? You're the first person I've heard from who's problem wasn't solved by re-installing the data. It would be an awful coincidence if it was just your particular copy though, considering your problem is something as specific as entering water.

I can't think of anything else. Only when I enter water, two different save files, deleting and re-installing did not fix it. It has to be the disk itself, doesn't it?

Maybe the water is too cold. Try warming it up a little.

Did you delete the game data and patch data ?

The same thing happens to me, it isn't a disc issue, why do idiots think its a disc issue. If that were the case, then the game would have been broken from the start, they patched something and introduced a bug with that patch, that is the issue, not the game.