any fluid will be come conductive after some time. this is because it is the stiff in the liquid that transfers the current, not the current itself.
be sure to run some type of biocide if you go the distilled route.
as for the tubing size, i have to disagree with the sales guy. running an undersized ID of tube results in a tighter fit. add a zip tie on top of that any it is doubtful that you will ever have an "incident"
since your kit doesnt use compression fittings, the OD of the tube isnt as important. the one thing to keep in mind is the thicker the tubing wall (OD-ID), the less of a chance that it will flatten if you make tighter bends. the actual tubing material also plays in this, but that is a good general rule.
i personally use 7/16 ID x 1/2" ID. i heat the ends in boiling water for abut a minute and they slip right on. the result is an extremely tight fit (once it cools/shrinks). i could even leave out the zip ties but i run one on each fitting just in case