Yes & Yes.
Great Bulrush is common in Midwestern Lakes, and occurs as you described. The only knock against it is that it can reach 10' tall under "ideal" conditions, which probably won't happen planted in a lake. If you want it to grow out into the water, probably go with Great Bulrush...if you want it to grow on the banks, I'd try Hardstem Bulrush, as it will generally stay under 5 feet.
