There is a condition called water intoxication, but it is rare in someone who is not either an infant or an athlete. You can look it up to understand it better, but the reality is that as long as you're drinking water over a period of time, and not your entire daily intake at once when you're dehydrated, there is very little risk to drinking a lot of water.
Obviously, people with medical conditions that include fluid retention, kidney issues, or other concerns should check with their doctor, but the average person really doesn't have anything to worry about here.
Personally, since joining here a few weeks ago, and after some sage advice from some long-standing members, I increased my water intake from around 80oz/day to between 160 and 200oz. I've noticed that my face is decidedly less puffy, and I feel better in lots of ways. I'm sure much of this is the result of all the changes I've made, but I feel confident that the increased water intake has been a very good thing for me. It also ensures that I'm fully hydrated, and that the weight loss I experience, hopefully, is the good kind, and not just the result of a depleted system.
BTW, I started at 350lbs. It's been said around here that one should consider adding 8oz of water for every ten pounds someone wants to lose, above the daily recommendation of 64oz. I freaked out when I considered how much water I would drink that way, especially compared to what I had been drinking, and a great recommendation I was given was to think of my weight loss in terms of intermediate goals and apply that to water intake. So thinking that along the way to losing 190lbs, I wanted to lose 100lbs, and so I thought I should drink at least 144oz/day.
This is a long way of saying it is very unlikely you are drinking too much water. It's more likely you're not drinking enough (though at 96oz you're doing better than most).
I am not a doctor or even close, and if you're concerned about a medical condition related to your fluid intake, please consult an appropriate health care professional!
Happiness and health (from the road)
Starting: 11/14/2010, 350 lbs (Yikes!)
Current : 03/31/2010, 295 lbs
Starting:1/20/2012, 335 lbs
Current: 2/10/2012 324.4 lbs
Goal 1: 302 lbs 04/01/2012 April Fools 10% Challenge
Goal 2: 271 lbs 07/04/2012 4th of July 10% Challenge
Goal 3: 247 lbs 10/01/2012
Ultimate Goal 160 lbs 05/31/2013
Lost: 10.6 lbs