Yeah it was a pisser. For me the key was not waiting and hesitating to confirm whether or not I succeeded in making the jump onto the wheel and was firmly standing on it before making the second jump. Rather, just assume the first jump was successful and try the second jump.
Caution - You are approaching the periphery shield of Vortex Four
The original NA version there was no waterwheel. You simply jumped over the channel and climbed the ladder to the valve. The ladder is broken now and the waterwheel was added.
To make the timing easier jump to the waterwheel when it's highest blade is perfectly horizontal to Ico. Climb immediately up onto it and jump for the ledge. DO NOT RUN-JUMP. Practice jumping forward from a still position before attempting this because if you take even a single step forward you will run right off the blade of the waterwheel.
Once you get the standing-forward-jump down the waterwheel becomes a piece of cake. I can do it every time without fail now.
It gave me a hard time. What I did was jump onto the wheel as early as possible (obviously) to maximize what little time I had on top of it. Then as soon as I shimmied up, I tapped left, then simultaneously tapped up and pressed jump. Very aggravating doing trial-and-error getting the timing down.
I had trouble with this bit too. What I ended up doing was as soon as I was on the wheel and stood up, I'd take a split second to move away from the edge and then take a quick step and jump forward. If that makes sense.
"3rd time watching you're thinking, how does he get his jumper on?" - Karl Pilkington on The Elephant Man PSN ID: SolidKev
it was pretty rough, in the end after I made the first jump and shimmied to the end of the arm, I was trying to climb up and stand on the platform, when ICO thankfully just jumped backwards from his hanging position to the top of the tower.