Do microwaves (photons) lose energy as they heat? I understand that microwaves are able to heat water because their alternating electromagnetic fields flip water molecules (dipoles) up and down which increases the waters kinetic energy (thus increasing temperature).
Doesn't that mean the microwave photons are then losing energy due to law of the conservation of energy?
In other words, if I took a single microwave photon (~30 cm wavelength) and passed it through a cup of water, would it come out the other side with a larger wavelength (because it lost energy interacting with the H2O's)?
 A: First, lets calculate the energy per photon for a 30 cm radiation:
$$E = \frac{hc}{\lambda} = \frac{(6.62\times10^{-34}\ {\rm Js})(3\times10^8\ {\rm m/s})}{30\times10^{-2}\ {\rm m}} = 6.62\times10^{-25}\ {\rm J}$$
That means that a 1000 W microwave oven is producing in the neighborhood of $1.5\times10^{27}$ photons per second (or $6.1\times10^{26}$ photons per second at the more typical microwave oven wavelength of 12 cm), and the energy associated with each individual photon is miniscule. 
When the water absorbs energy from the electromagnetic wave, it absorbs whole photons rather than taking only part of the energy from a photon. The vast number of photons involved in the interaction means that the energy in the EM wave can essentially change continuously (the water can absorb 10% of the energy or 10.01% or 10.10203910% of the energy without having to only "partially absorb" a photon). 
A: Typically, the microwave photon is absorbed by a water molecule, so any re-radiation you get out the other side wouldn't be the same photon anymore.
A: http://www.businessinsider.com/how-do-microwaves-work-2014-6
"The positively charged end of the water molecule tries to align itself with the microwave's electric field while the negatively charged end points the other way. But because the field reverses 2.5 billion times a second, Mickey's ears and face are being twisted back and forth rapidly."
(The molecule as illustrated in the referenced text resembles the rounded head and ears of Mickey Mouse)
What you get isn't so much a LONGER wavelength compared to the energy being absorbed, so much as a SHORTER wavelength (infrared) produced by the action described above (the dipoles of the water molecules twisting rapidly back and forth).  A microwave photon may do this many times, being reflected and re-entering the water or food being heated until it is heated to the desired temperature.  The interior of the microwave oven is a tuned cavity. Any foodstuffs heated in there detune the cavity, and if it is working properly and the rest of the interior of the microwave oven is relatively clean, it is quite efficient (60-70%).   Some energy loss is also dissipated in the magnetron in the form of heat, which is once again, a shorter wavelength than the microwaves that do the actual cooking..
