I was considering insulating the water heater too, but more heat is lost due to the burner area taking in cold outside air, heating it to within a few degrees of the water temperature, and expelling out that air out the top of the water heater.
One of the solar guys turned on his water heater and it used about 200 watts per hour to keep the water at 140F up in Canada. Don't know what the outside air temp is, but that is about 600 Btu's per hour loss to the outside air. Probably only about 50 Btu's is lost past the insulation into the interior of the RV, and that heat is actually a gain in the winter time, so no need to run the furnace as much. You probably cut that heat gain to only about 25 Btu/h with all the extra insulation. I probably would have used Reflex, less smoke if it ever caught fire, and will not spread flame once the propane is off.
I normally leave my water heater off once I am done with my shower, unless I am doing dishes, so I will not lose much heat each day. When done with my shower, the heater is only about 110 F anyway. This will drop down to about 80F by the time 24 hours has gone by, especially if cold at night, might reach 65F.