I vaguely remember as a kid being able to squeeze between the pipe and the bricks at the end of a water world that would take you to another water world that never ended. Does anyone recall this or know exactly how to do it? Or is it just a lie I told all of my friends as a kid that has somehow become a reality in my mind over the years?
Yes. You use the warp zone at the end of level 1-2, but instead of getting to it the normal way (jumping on top of the bricks at the top of the screen), you crouch, and hop into the pipe just before the warp zone. This video shows the proper technique: