I am sure Kumo has rivers and lakes connected with other villages and its not like the toad can't survive on land and sensors have a range and they need to activate it to even sense someone, Jiraiya doesn't even need to stay in his toad form all the time. He only needs to use the technique before entering the sensor's range and reach Hinata.
And Jiraiya did spy on Orochimaru and Akatsuki directly and indirectly.
Kumogakure is hidden in the clouds (not in the rivers). Sensors range starts from them then expands outwards. Then you have barrier teams and you have Bee who's confned to the village. He'd likely be given the duty of protecting the 2nd most valuable asset(Hinata). You keep your most prized possession in a place which is the most fortified (near the strongest guards etc/ near the raikage). Kumo isn't a fodder nation according to the data book they have 5/5 military strength. You don't get strength like that by being a fodder nation.
Jiraiya could never get close enough he'd take out any threats to his godson if he could. His spying on the Akatsuki would've been general the same for Orochimaru.
Jiraiya is a good character and best hope of konoha but the terrain itself is his downfall shortf coming unless your implying Jiraiya could solo the strongest miltary power in the nv. Konoha had 3/5 rating incase your wondering.
Jiraiya getting busted would've caused the war that would've wiped konoha out. With an alienated and isolated Uchiha clan it was game set and match.