RAW, I am reading that a creature has a Will or all of the fluids in his body are destroyed. Nothing in there says it doesn't effect creatures however it doesn't spell out the mechanical effect that happens to creatures, but it reads as a save or die effect for most creatures. So, say a Blue Dragon uses his 10 foot burst against a wildshaped druid attacking him. Liquid-based magic items (such as potions) and items in a creature's possession must succeed on a Will save or be destroyed. Unattended liquids are instantly reduced to sand. Alternatively, it can destroy an equal amount of liquid in a 10-foot burst.
Desert Thirst (Su) wrote: A blue dragon can cast create water at will (CL equals its HD).
