[Carl n Susan]

That appears to be surface rust on the cover plate based on your photos. I agree with AZ_Traveler, change the pressure valve and the on/off switch. They are easy and relatively inexpensive. Replacing the entire water heater is not.

What model Big Sky do you have? You should add the year and model to your Signature to ensure it is always attached to your Posts.

When you ask about the "water tank" are you referring to the hot water tank or the fresh water tank? I assume you mean the hot water tank and it is attached to the back of the cover plate. Depending on your model and where the WH was installed, it might be accessible from the inside under a cabinet, or in the pass through area after you remove the back wall. Hence knowing what model you have may help determine the location and access to the WH.

Finally, it is better to create new Threads for each different issue rather than mixing them together in one common Thread. It make things neater withing the Thread plus making the information easier to find later.