Deionized water might help, but it'll still be conductive. We're not talking lab-clean conditions here, and most contaminants will up the conductivity. You could try some of the new nonconductive coolants, but I've heard mixed reviews and they're expensive over time. Watercooling, like anything with PC building, is perfectly safe if done right, and potentially dangerous if done carelessly. Plan, test, and monitor, and an H20 system will be as safe as anything else.
The Bigwater kit (which I assume is what you're talking about) has gotten Thermaltake's traditional mixed reviews, though the performance looks decent and at a low price point. If you want to go the prefab route, which has the advantages of typically lower cost and ease of installation, you might also want to look at Corsair's Cool setup (though it's a bit less prefabbed). There are others as well, maybe Cooler Master's offerings, but most are of lower quality than the first two.
As always, read the reviews!
-HC-