Now you don't!
After all the stress and anxiety of getting the new water heater installed, I have eased the memory by erasing the view of that very appliance. Until we know if a tankless water heater is in the budget, this ceiling mount curtain track and canvas drop cloth will serve the purpose of disguise.
In the photos, it looks vaguely like a tiny European shower or a changing booth for Superman, but I think it looks a bit more attractive in person. And certainly better than a large metal tank with pipe protuberances everywhere!