Actually, the Z-limit option performs a different function that what you were trying to use it for. What it does is it constrains what gets "filled".
In terms of setting the pond elevations, one possibility would be to employ Raster Calculator to recalculate the lower elevations.
Raster Calculator—Help | ArcGIS for Desktop
Conditional Evaluation (CON)
Con (in_conditional_raster, in_true_raster_or_constant, {in_false_raster_or_constant}, {where_clause})
Con—Help | ArcGIS for Desktop
So in Raster Calculator, it would be something like this:
CON (DEM filename, 1079, elevation field, elevation field <1079)
Caveat - the tricky part will be if there are other parts of the DEM that are below an elevation of 1079 meters, as this universal CON statement will modify those too. If that is the case, you will need to select just the cells that need to be modified (the pond cells) and then apply the CON statement to only them.
Chris Donohue, GISP