As a critical intervention for enhancing inland navigation efficiency, waterway regulation projects profoundly modify riverine hydrodynamic conditions while optimizing navigability. This study employs the MIKE21 hydrodynamic model to establish a two-dimensional numerical framework for assessing hydrological alterations induced by channel regulation in the Hui River, China. Through comparative simulations of pre- and post-project scenarios across dry, normal, and wet hydrological years, the research quantifies impacts on water levels, flow velocity distribution, and geomorphic stability. Results reveal that channel dredging and realignment reduced upstream water levels by up to 0.26 m during drought conditions, while concentrating flow velocities in the main channel by 0.5 m/s. However, localized hydrodynamic restructuring triggered bank erosion risks at cut-off bends and sedimentation in anchorage basins. The integrated analysis demonstrates that although regulation measures enhance flood conveyance and navigation capacity, they disrupt sediment transport equilibrium, destabilize riparian ecosystems, and compromise hydrological monitoring consistency. To mitigate these trade-offs, the study proposes design optimizations—including ecological revetments and adaptive dredging strategies—coupled with enhanced hydrodynamic monitoring and riparian habitat restoration. These findings provide a scientific foundation for balancing navigation improvements with the sustainable management of fluvial systems.