First, the water heater will not drain completely -- so you may be seeing water in the heater. If you have a motor aid on the heater, the leak could be where the hoses attach at the back of the heater. To remove the heater, you have to take out all of the screws around the heater and then you have to break the seal that is behind the flange of the heater. At the factory, they use a sealant to seal in the heater. I just removed mine this last week and it took almost two hours to break loose that sealant. Disconnect the gas line and then you can start to remove the heater. You will also have to remove the hot and cold water lines to remove the heater. If you do have the motor aid, your hoses may be short so be ready to pinch them off so you can remove them without loosing too much antifreeze. Be careful with the 120 volt wiring as you remove the heater. When you put the heater back in, I used gasket making material (bought from the auto store) to reseal it.
Dave and Karen -- '02 Ultimate Advantage 36 C, 350 HP Cummins, Allison 3060 Tranny
'07 Ford Escort, Brake Master 4160, '13 Ford Edge, InvisiBrake