"This change came from someone who showered so long without ventilation, they ran out of oxygen and died. Most of us would never let anyone shower that long so it must have been a BIG boat. "
I'm not sure that anyone actually died, but I do know firsthand one of the folks who was involved in a near death. He passed out in the shower on a 45' sloop, and the issue involved the venting of the heater unit. Fortunately the owner was an MD and was aboard. I don't recall if the problem as monoxide from the burner or oxygen exhaustion, just that it was one of the first instances and the industry became very alert to installation/venting issues as a result of this and a few others.
These units *are* perfectly safe *if* properly installed and vented, the same as home units.
If your water tank is 22 years old, it may be time to change it anyway. Hot water tanks usually leak in half that time, unless they are plastic. Can I live without hot water, sure. Is a nice hot shower to clean up or ease sore muscles a wonderful luxury? Sure again. So if you can afford the luxury, I'd vote for it. If you need the space, or you don't run the engine, or you plan to tie up where there are always facilities...not so necessary. Even if your engine is raw-water cooled with a 140F thermostat, a properly plumbed hot water tank should get plenty hot enough. There's often a valve or fitting or other five dollar plumbing part that's not working properly. Usually installed in between the tank and the hull where you can't see or reach it.