alternatvely: 靠山吃山，靠水吃水
I have only a very vague understanding of what this proverb means and am supposed to write a little story or essay based on it.

some interpretations or situations in which it would be used would help me a lot.

【释义】比喻自己所在的地方有什么条件，就依靠什么条件生活。

【出处】明·冯梦龙《醒世恒言》第三卷：“自古道，靠山吃山，靠水吃水。”
【示例】～，靠阎王吃小鬼。 ★《上饶集中营·集中营在福建》

--> "Those living on a mountain live off the mountain, those living near the water live off the water."

--> live according to the your environment's requirements and resources

http://baike.baidu.com/view/250057.htm

This article looks like an interesting resource for your essay, it uses the 俗话 to describe an approach to 可持续发展 in forestry, called "现代林业行动计划"

The introduction is particularly interesting: "“靠山吃山，靠水吃水”，但“吃山”怎么个吃法却各有不同，有的是吃子孙饭、断子孙路，但有的却是越吃山越绿，越吃山越美。南云台林场现有山场3万亩，森林植被优良，多年来以开山采石、销售石子这种“靠山吃山”的模式，在为林场带来收入的同时也破坏了生态环境。"


"靠山吃山走上发展双赢路"
http://news.xinmin.cn/rollnews/2009/12/02/3013579.html

Thank you very much. I hope my Chinese will be good enough to understand the articles, but I'm sure with my trusty pop-up dictionary I'll get the gist of it. ;)