It seems that if you put try to dispense too much TNT in a small space with water that the TNT will go out of the block and explode as if it were not in water. I can re-create this by having 4 dispensers facing each other, filled with TNT, with water in the middle, and then setting them all off at the same time. If only 3 of the dispensers have TNT it works fine, but a 4th will cause it to break.