How many BTU is required to do the job? At what elevation? Let’s make it easy and assume sea level
That’s not btu’s 
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No the conventional Water heater was not hooked up to power; it was just used as a HW storage tank. Odd choice as there were only 2 adults in the home, which is only 2200SF with 2 bathrooms.
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Nope; 2 adults, 2 bathrooms in a 2200SF house
Is this for domestic water only? Around here, smaller houses use the water heater for radiant heat as well. The storage tank is the buffer tank and is heated by the water heater. This works well when the domestic water has priority over the heat and cycles directly to the fixture. Any photos of the connections behind the wall?
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No other photos. It does have radiant HW heat, but that’s a separate boiler in the crawlspace.
That’s funny. So if nobody has used the hot water for a while, and wants to take a shower, they probably have to waste 20 or 30 gallons before it gets hot again…
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Is it just me, or is that Water Heater (Tank) set-up as a Pre-Tempering tank?
(Color coding and connections at the Tankless WH seem to indicate that being the case).
Considering the home has an In-floor Hydronic heating system, it is feasible for that to be the case.
Google also shows some graphics where this may confirm this thought.
Sure would be nice if people started posting proper and complete photos when posting.
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I like the fact that the seller has the cold water line insulated and the hot water exit from the tankless not insulated as well… 
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I’m assuming there is a condensation issue/concern, where there usually isn’t on a hot pipe. .
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after reading the comment by @bnesbitt above, it seems the it would not. when the water level starts to go down, the on demand kicks in and sends heated water to the top of the hot water heater (finally get to use that term correctly) and then out the top so that it wouldn’t be as cold as if it were sitting in a tank and needed to heat up completely as if you had just turned the water heater on. i could be wrong, but after giving it some actual thought it doesn’t seem that bad.
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You are correct. Most here haven’t read the original post. They don’t know that the water heater does not have power. It’s a 40 gallon pipe between the source of hot water and the users fixture.
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Well, probably to the bottom of the tank via the dip tube.
But that hot water will quickly rise to the top via convection.
In other words it’s a much smaller than 40 gallon pipe.
The water will not quickly rise to the top of the tank due to convection. It will slow slowly mix with the cold water in the tank.
I’ve started up thousands of water heaters in my 38 years experience as a licensed plumber. You don’t get hot water immediately.
Can you tell me what your experience is?
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^^^^^^^^This! The hot water will disperse as it enters the tank and it’s heat will be absorbed by the cold water surrounding it until all the water is at the same lower temperature.
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Excellent description Robert. You are correct, the hot water or the heat will be absorbed into the cold water
Just so I’m clear, this looks like a redneck “indirect” water heater. I installed indirects for dhw on high efficiency furnaces a number of times. If this boiler is high efficiency, then it’s potentially more efficient than your basic electric or 80 afue gas water heater. I didn’t look too hard at the install, is it modulating and condensing or just basic burner?