Triforce, you must remember that the Ocean Palace wasn't made in modern times. Of course it doesn't have the things we have. It relies on magic. Water tight compartments? There was no need for them. It was constructed in such a manner that there was no way water would come in. Note that you do not take a sub in, but that you teleport in. If a breech does occur, they probably have something similar. Or they can simply pump it out with magic.
Security cameras? What is the need? In order to get to the Ocean Palace, you need to be able to get to the throne room of Zeal, which is quite a feat. Earthbound wouldn't get that far, and it would seem as though most of the denizens of Zeal wouldn't want to destroy the palace. Schala doesn't have the guts to do it, and the gurus who oppose Zeal were locked up when it was made. Emergency escape hatch? You must remember that Queen Zeal is nucking futs. The people in the palace probably don't matter to her. All she really cares about is Schala and herself. And if Schala won't cooperate, then Schala can go to hell.
Nothing is fool proof. Have you heard of the pirating stuff going on in Africa as of late? Modern day war ships being taken over by modern day pirates. If anything, short of Lavos going BOOM, the Ocean Palace was safer than a modern day ship. Mainly because you would need to be a very determined guy to simply get in it. Note that Crono and co. did not destroy it, but Lavos did. And even after that, it rose again, good as new. Very safe, if you ask me. I agree with Acacia Sgt. there.