Yes, those signs were removed when the new portion opened in Nov2023. They were there since portions of the old road were used for construction vehicle access.
The water tower is just north of the north entrance, on the west side of Bayshore Rd. It is visible on GMaps satellite view.
Yes, it is easy to walk a loaded touring bike around the closed gates.
I contacted the director of Tillamook County roads about signage for the gated-off section and he said, "The old road is an active slide zone and is officially closed. We don't endorse using the old road (as signs would imply), but we are not forbidding its use."
In a somewhat separate matter, he also happened to mention that Bayocean Rd NW (which connects to Bayshore Rd) will be closed for a month sometime during the summer for a bridge repair. That is a bummer since their vehicle detour will direct folks to Hwy 131 which is awful for biking (high speed, curvy, narrow, no shoulder). I would recommend that cyclists use Elkhoff Rd to bypass the most awful section of Hwy 131. That detour can be seen on
https://ridewithgps.com/routes/44349299-John