Thanks for all the input guys, that really helps. My main 2 reasons for thinking about this was for the efficiency and the space savings in furnace room (I have a fairly small house).
Cam - with a family of 5 and regular baths/showers for the kids I think I may hit those inefficiencies with it running fairly often.
Jason - the hybrid system sounds like a great idea (never heard of that concept before) but there goes my space savings if I need a secondary tank anyway. And having 2 tankless systems just doesn't make sense cost wise for me.
Mark - good point on the temp of the incoming cold water, mine in Ottawa is quite cold, even in the summer if you let it run long enough.
So so far based on what I'm learning I am leaning away from the idea, but have not ruled it out yet.
I wonder if there's any calculators out there that let you figure out what the best option is for you?
