The Water Cell is created by holding an Empty Cell and right clicking a water source, similarly to a bucket. One empty cell will be removed from the stack you are holding and one water cell will be placed in your inventory. Their most notable use is in the creation of Coolant Cells for Nuclear Reactors and Overclocker Upgrades. They can also be placed in a Compressor to form a snowball, but this is wasting tin.
However, filling many empty cells with water in a short time on a SMP server can cause the number of filled cells to glitch slightly. The error is only client side and likely due to slight lag. The number of water cells is easily corrected by moving the water cell stack in the inventory.
Example: you have one stack (64) empty cells and an infinite water source. You rapidly fill the cells with water. When you are out of empty cells you check your inventory and have only about 40 or 50 cells in your inventory. When you attempt to move the incomplete stack it will automatically update and the stack consists of 64 water cells again.