Shallow water seems the safer option both to avoid sharks/ other sea animals, and to avoid any problems with the ocean water/drowning.  But the sand isn't that soft sand that you may think you will fall on if a big wave comes in and knocks you over...it's more like hard cement:

As I researched this story I found out it's a repeated occurrence at beach destinations nationwide.

Over a three-year period at the emergency room at Beebe Healthcare in Lewes, Delaware, they reported 1,519 swimmers with break-zone wave injuries that required treatment.

"The people who are getting injured are really the bathers typically not in a great deal of water," said Dr. Paul Cowan, who directs emergency medicine at Beebe Healthcare and has treated many of those patients.

"The energy from a three- or four-foot wave can have the same effect as being hit by small compact car traveling at 20 or 30 miles per hour," he said. And while the injuries can be minor, like fractures of the arms and legs, the potential for paralysis and death is real.

Josh Basile, who spent his childhood swimming at the beach, knows that all too well. The then-college student was on a family vacation in Delaware in 2004 when he became one of those statistics.

"I was in waist-high water with my back to the ocean when a wave picked me up and slammed me head-first against the ocean floor," he said.

Basile was left a quadriplegic. He's now an attorney who represents the catastrophically injured.

Ken Haskett, a Los Angeles lifeguard and water safety expert, has also seen some of those injuries.

"We have a lot of spinal injuries, a lot of shoulder injuries, neck injuries," he said. When I ask him about our misconception that the sand is soft and can’t hurt you if a wave knocks you down onto it, he replies: "That sand, it's like wet cement."

(via ABC News: "Beach Warning: Shallow Water Brings Potential for Severe Injuries")

Here are some tips:

• Swim in lifeguarded areas - they can help you if needed and also provide advice on the best area to go into the water.
• Think like a surfer - survey the water before going in so you can get an idea of what to expect on the type/size of waves, and timing of the waves.
• Pankace and grab sand if a big wave is heading right at you: 

  If you get caught in the surf zone and a wall of water is bearing down on you, don’t stand tall and brace yourself. Haskett explains why. "It tightens you up and the wave will push you over and slam you into a sandy bottom, possibly hurting your neck, hurting your shoulders, or your arms," he said. Instead of bracing while standing, you should drop down, pancaking your body flat to grab sand. As counterintuitive as it seems this move will keep the force of the wave off your body as the energy of the wave dissipates on the water above you. Yes, you can dive under it, but lifeguards also see injuries where people hit sandbars and reefs when they dive, so your safest bet is to pancake.

• If you get in the "spin cycle" of the wave:

In these instances a few strategic moves could save your life. First, Haskett says you should put your hands at the base of your head where it meets your neck lacing, your fingers together. "Grab the back of your head, elbows are in front of you so if you hit the sand you're kind of protecting your head," he said. This is actually hard to do when you are being tossed around like a rag doll, but it does offer some protection. Next -- and this is really hard but incredibly helpful -- tell yourself to relax. Surfers call it a hold-down, when you feel like you can't get up for air, but it passes fast. Not panicking conserves oxygen and energy.

• Keep your head on a swivel when you're getting out:

I spoke with Captain Joe Donnelly of the water patrol in Bethany Beach, Maryland, and he said the majority of accidents that they see happen when swimmers are getting out of the water. The maxim of the ocean is to never turn your back on the water, but that is physically impossible when trying to get back to the beach. Instead, time your exit so it's after the big swells in a set and in the smaller waves. Don't lollygag in the break zone, and keep your head on a swivel. If you see a big one coming and you don't think you can make it to the beach, head back out to deeper water and hit the deck in that pancake move to grab sand and wait out a better time to exit.

(via ABC News: "Beach Warning: Shallow Water Brings Potential for Severe Injuries" - click for video)