This is a situation of “you don’t know, ’til you know”. There are a bazillion kinds of water-heaters. They are the most important thing in your home, next to fast internet service, and a good bed. Trust me when I tell you this.
I have spent the last week learning more than I ever cared to know about water-heaters. Really a LOT about them. I just want to say, if you are in Seattle, call http://www.fastwaterheater.com/. Ask for Fred. Write the check. Know that this is one of those problems where throwing money at it is the only way to go.
And know that tonight I will be taking a hot bath with a cup of tea and I will get rid of all the information I have in my head about Water-heaters.