This happened to mine too! :S
Well, what I did was I put my Pokewalker somwhere safe where no one would touch it, and waited for the water to evaporate, but it didn't :( - my graphics were gone, and all that worked were the sounds, but if your lucky, your Pokewalker may still work.
So what I did is I sent the Pokewalker off to Nintendo and they replaced mine and got me anew one. If you reset the Pokewalker in HG/SS, you will lose all your Watts, but Routes will stay :) (Suggestion: Force you Pokemon back from the Pokewalker before doing this. Any caught Pokemon in the Pokewalker are also lost as well as the Watts.)
Once you get the new Pokewalker, set it do the DS like you did the first time with the "brocken" one.