Another option for the sensor might be to use a BMP085 in a pipe (sealed at the top) to measure pressure and so get the water level. It would also give the air temperature in the pipe which might be nice to know.
Here is a video where somebody has used a BMP085 with I2C to an Arduino;
As far as networking goes I use wireless but I have combined it with three Power Line Carrier modules that use the mains cabling in my house to give wired ethernet connections in some rooms. Your have two water tanks in a basement garage so there may be mains there and PLC might be an option. Of course you need at least a pair of PLC modules plus ethernet shields which adds to the cost.