People tend to think that a ship sinks quickly. In reality it would take several hours for a ship that size to sink (if at all) even with a large hole in the hull. They are designed to have multiple compartments that are sealed from each other so that if one fills with water the others won't and will keep the ship afloat. The muster drill that each cruise has before sailing is exactly what a real emergency would look like. Everyone gets to their emergency station (without using the elevators) without a problem on each drill in no more than 15 mins or so. You don't have to worry about getting everyone into lifeboats...
As for the cove vs "real" balcony, you are correct. If you want the sun then a true balcony cabin is better. However, for those that want to be close to water to minimize movement to prevent sea sickness, they are a nice compromise. In my opinion they are just a method for Carnival to be able to charge more for cabins that would otherwise could only be ocean view cabins.
Carnival Cruise Lines:
Fantasy 90, Celebration 95, Victory 05, Conquest 05, Spirit 6/06, Freedom 6/08, Holiday 7/08, Victory 6/09, Valor 9/09, Dream 6/10, Splendor 8/10,Conquest 8/11,Magic 11/11,Triumph 4/12,Spirit 7/12,Freedom 11/12, Triumph 2/13 - The fire cruise
NCL Dream October 2006, RCCL Mariner OTS June 2007