Answer:
It happens when something has been cut with H2O.
I am nothing really at all, Yet I am easily found; Ignore me at your own peril, and you might end up crowned!
Something wholly unreal, yet seems real to I. Think my friend, tell me where does it lie?
What dress does everyone have, but no one wears?
Brown I am and much admired; many horses have I tried; tire a horse and worry a man; tell me this riddle if you can.
You use it between your head and your toes, the more it works the thinner it grows.
Difficult
Animal
Easy
Food
Funny
Kids
Logic
What am I?