I decide to just at least try this puzzle without help a few times more...
Eventually, I say "screw it," and find the guide to solve this challenging puzzle...after I follow the solution slightly (I pushed the pillars on the left side instead of the right), I get to the ledge!
In the chest, I get...an Ice Wand!!!
Now I can shoot ice, ho ho ho!
I try the wand, nice ice effects!
The wand also has a charge attack, making a larger iceberg!
I head to the cave where I found the Sluice Key, and use the wand on the fire pillars on the ledge above the Sluice Key chest.
They turn to ice, and I smash them with the flail.
I find another chest! And this chest has...a Life Vessel!!!
My health is now maxed up to 32!!! Yes!!!
I head back to the watermill area, and save at the portal chamber.
Those puzzles are very hard to solve without a guide, I am dead serious!