I'm not much of a fan of any type of bit that can completely collapse in the horse's mouth and wrap around the tongue/bars. Yes, it keeps the horse from picking it up and leaning on it, because it moves around and is therefore more painful to lean on, but it also prevents the horse from ever "carrying" the bit like he should. So you're stuck with a horse that never can carry the bit and work properly on the bit when using on. I've had horses that like to lean on the bit, and most of the time some consistent work out of a bit or letting the reins "slip" a little when they try to lean helps just as much as the waterford supposedly does.
That, and I do think they're abrasive. I've seen people ride in them, and even when they have "soft hands" the beads can very easily grab the lips quite nastily and I'd imagine they can also grab the tongue and bars as well and rub there. Rather than a smooth bit that just slides across the lip(if it's correctly adjusted and not cranked up 2 inches like some people think they need them), the waterford catches on the lips with the slightest amount of direct reining. Smooth is the only way to go in my opinion - I don't want anything rough or edged sitting in my horse's mouth, even if it's rounded. As it comes down to it - I hate the mantra of "a bit is only as hard as the hands". I think it's a ridiculous statement that's used to justify all sorts of terrible mechanisms and "training tools" because we supposedly have "soft hands". Personally - I've been riding for a meager 2 decades and I wouldn't ever consider my hands soft enough to use some bits, including the waterford due to the way it wraps around the jaw/tongue. I want my horses to be able to feel the bit, and be able to carry it in their mouths so they can clearly feel each signal as soon as I send it, and this bit doesn't allow for that.
"The art of riding is hard to find and easily lost."