We can use water as a barometer if we increase the height of the tube.
In a column of a fluid, it is the height of the column that is important, not the width. Mercury is used in a barometer because of its high density. One atmosphere of pressure is enough to push mercury 760 mm (about 29 inches) up an evacuated tube. Or, put another way, a perfect vacuum would be unable to pull mercury any more than 760 mm up a tube.
For water, 1 atmosphere of pressure can push a column of water 10332mm up a tube, or about 33.9 feet.
So a mercury barometer can be made much smaller than a water barometer, though both are capable of doing the job.
Increasing the diameter of the tube would not be effective; we would have to increase the LENGTH of the tube substantially.
One atmosphere pressure supports a column of mercury approx.
I grant that mercury is dangerous stuff to use in a lab. You get a mercury spill and you have a great deal of trouble cleaning it up (contract cleaners, reasonably, won't touch it). However, a water column of 10 m would be a couple of storeys high on a building, very impractical, which is why we use mercury.