[chrisguyw]

The purpose of "running in a motor" is to get the motor brushes to more accurately conform to the radius of the commutator, which improves efficiency and torque, letting the motor perform as well as it can given its.....magnet strength, air gap, armature wind (gauge of wire x number of turns), armature balance etc, etc. It will not improve the motor  beyond its component design/limitations, or any flaws in its assembly.

Whatever type of motor you are "running in" (low power plastic car motors up to "open" commercial motors) it is important to avoid "arching" (very simply,....sparks seen between the brush face and the comm.), this "arching" pits the comm. surface, making it less efficient, and invariably hampers performance.
This is where the use of water can help, as it acts as a lubricant, reducing arching. Water has been used to run in slot car motors for decades, and really started with the high end commercial type motors.

While a lot of racers of higher end "commercial" type cars do break their motors in mechanically (no electricity), for the motors most commonly used in the plastic cars,  hooking them up to a power supply is fine...........a few break in suggestions

1/ Run the motor at a voltage that minimizes any arching.....1 to 2 volts will do all that is necessary, and 10/15 minutes will do the trick.
There is absolutely no benefit (actually only harm) in running the motor in at anything other than minimal voltage/speed, nor for extended periods of time)

2/ Break in  the motor in the direction that it will run when in the car

3/ You can certainly use water (tap water is just fine)......absolutely zero benefits to using alcohol, WD40, special concoctions, whale tears, etc !!
(It is not a good idea to use water on any closed can motor, and if using water, after the run in, and with the motor running, blow it out with some compressed air or a hair dryer. When dry apply a SMALL dot of oil to both the can and endbell end of the motor.

Cheers
Chris Walker