I haven't had much luck with flow sensors and Arduinos, it may depend on what else you're doing on the Arduino but the interrupts are limited and I had concerns on the impact to the rest of my code. For what I was measuring (RO system efficiency), it didn't seem incredibly accurate over long periods of time.
Also, with those flow sensors (I have the Swissflow ones), there is a little propeller in there that looks like it would get destroyed by any grain husk or hop leaf it might encounter.
I would consider a method similar to the Blichmann Autosparge or the MoreBeer sparse thing. Those basically keep a certain level of liquid on top of the grain at all times.