I made a 2d fluid solver based on Navier-Stokes equations with display interface. It is based on research made by Jos Stam and described in his publications. Below few links, for more information go to my website.
Jos Stam publications - dgp.toronto.edu/~stam/reality/Research/pub.html
Real-Time Fluid Dynamics for Games - dgp.toronto.edu/people/stam/reality/Research/pdf/GDC03.pdf
ScriptSpot - scriptspot.com/3ds-max/scripts/2d-fluid-solver-in-maxscript
Post on my blog with some more info - tas3d.com/blog/?p=374
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