Great find! Any chance there is a map of the designated water sports areas?
I have not seen a map, but officially scuba diving without a flag is not allowed in designated watersports areas. Scuba diving without a flag is allowed only in designated swim areas which must be marked with buoys.
Though the regulations seems to separately address diving and swimming in some areas, the definitions section of the regulations specify that the term " 'diver' includes a snorkeler;" Be forewarned that snorkeling without a flag may also be a violation.
Designated swim areas are not specified by coordinates in the regulations. Any property owner can set up such a swim area with permission of the Port Authority:
147. (1) Any person in control of a beach to which access is provided from the sea may, with the approval of the Authority, set aside an area within two hundred yards of the shore as swim areas, provided that such area is kept marked by marker buoys which have been approved by the Authority.