there are water slides that invert but I dont think there are any water coasters that do, so this could be cool for AT to look into as it gives them a worlds first and replaces the flume with a similar but upgraded ride. The only problem is that it takes away the family asppect of the ride and therefore it isn't a family log flume anymore but I don't mind!
I think there are a few issues that would prevent this.
Water coaster cars that can free float are big and heavy, lots of incredibly high stresses on both the cars and the tracks for a loop.
You'd need to secure the riders in a way they wouldn't be able to wriggle out of. Given that water rides can rarely flip or crash (happened at a funfair in a few years back in the UK and happened at Port Aventura and there's the infamous incident with the Thorpe Park Rapids), a situation where someone is being held underwater and drowns is particularly grizzly.
Lastly was the point you brought up. Log flumes are big showpiece family rides, if you get rid of one, you need to make sure it's replaced with something on the same level. It's probably this reason why Thorpe Park didn't get rid of Loggers Leap after building Tidal Wave (it's large height puts of a lot of people).