The breather cap is on TOP of the differential, leaning more on the driver's side.
The breather cap should survive water crossing at ANY depth. When pressure builds up in the differential, the air will blow out by way of the breather cap. If the cap functions properly, then it will close immediately after expelling the hot differential air. Think of how the exhaust/muffler works under water...same principle...that is, you don't worry about your exhaust under water, right? The hot air pressure from the exhaust is enough to push the water out of the muffler (your muffler does NOT drown when submerged). You do NOT have to worry about water going into the differential IF the cap functions well.
The POTENTIAL PROBLEM WITH THE BREATHER CAP is that dirt/mud/dust may get under the cap and, thus, doesn't let the cap close completely. When this happens, you can have water get into the differential. That is, the cap may pop open to let the hot differential air out, but it won't close completely due to dirt/mud attaching to it.
Hope this helps.