When two ships at sea meet in battle in AoW, and one of the ships is destroyed, all non-swimming units aboard the dead ship immediately die.
Apparently, when a free-movement ship on land, carrying a mixture of swimming and non-swimming units, is involved in a battle with a swimming unit in a neighboring sea-hex, if the ship is destroyed its non-swimming contents are also destroyed.
No doubt this also applies to Wind Walking ships.
Support evidence is in Unicorn77's post in the Doubles Group 1 thread in the competitions board.
So watch out how you involve your free-movement ships in battle?
In a related note, I had a ship next to a land-based mana node. The ship was swimming-only (no spells) but had several lizards aboard, and I'd just taken the node. When land-based units attacked the node, my lizards were drawn into the battle and slain, a possibility I hadn't considered (although it made sense in retrospect).
Watch the shores!