I think rg255 and Troyseph pretty much nailed it, but another thing to consider is the crocodilian's habitat. All surviving forms are aquatic, with at least one species - the marine crocodile - at home in the sea. In addition, most, if not all, crocodilians live in tropical or subtropical regions.
In fact, many "living fossils" are associated with tropical forests or the sea. The marine coelacanth is one of the most celebrated living fossils, for example. The most primitive living fishes also include the lungfishes, which are generally freshwater tropical species.
The tropical monotremes are considered the most primitive living mammals (and the platypus is semi-aquatic to boot).
Their niche and "biology" also make it relatively difficult for crocodiles to exploit other niches. Even if they were't tied to water, one could hardly imagine a crocodile climbing over a high, cold mountain pass to reach a lush, tropical forest on the other side.
It's worth noting that all the terrestrial crocodilians have died out, leaving only their aquatic or semi-aquatic relatives.
Here's one interesting source -- 12 of the most astounding 'living fossils' known to science.
Most of the species listed (including the coelacanth) are marine organisms. It also lists crocodiles, and I was surprised to learn that crocs evolved from marine organisms themselves. (See This handsome sea creature is where crocodiles came from).
Similar lists include tropical forest creatures, like the African okapi and Australasian cassowary. Note that rhinoceroses and tapirs now occur only in the tropics (and perhaps subtropical regions for African rhinos), now that the more recently evolved woolly rhinoceros is extinct.