I'm not an expert but the issue I have seen is that you need to get a commercial unit to get up to the temps you would want to mash in with. Residential water heaters top out for safety reasons. Maybe some one with the right know how would be able to deal with this though.
I still like the idea of those water heaters and look in to them again every couple of years but for me it was a lot cheaper to build a heat stick and add a temp controller and a timer so that the strike water would be up to temp by the time I wake up.
