I had a 1990s Sci/fi Fantasy children's book or novelette that was lost. It could have been an anthology including a short story or novel about two children, sea creatures and two magicians; one good and one evil.
On the cover, the children were standing onboard a sailboat/skiff/dinghy. Below them were two mermaid creatures; one male, one female. The sea creatures were completely white.
An evil wizard/mage wanted the wealth of the Piscean creatures. It seemed that the children were either teaching them to fight by helping to build products of war. With the good magician on their side, they went on land to physically fight the dwarves of the evil magician who was a fire sign.