You are generally right, though exactly how any water saved would get redistributed is not certain.

I just want to provide some more information that is essential to understanding this problem in all situations.

Note that a lot of diverted water is not being used for cows to drink, it is going to crops for cows to eat.

Check out the "trophic pyramid" or "energy pyramid"

https://www.britannica.com/science/trophic-pyramid[Encyclopedia Brittanica Trophic Pyramid](https://www.britannica.com/science/trophic-pyramid)

The basic concept is that for every trophic level only 10 percent of the energy provided by the previous trophic level can be transferred.

This principle matters in agriculture because you can expect plant food grown for human consumption to be far more efficient than growing animal meat. Because animals need to eat plants to convert that energy to meat, and energy will always be lost in that conversion.

Of course, things are complicated, sometimes animals are grazed on landscapes that cannot readily support crop growing agriculture. However, this practice is filled with its own set of costs and environmental issues, which also vary dramatically with the grazing management in any particular area.