Would pipe insulation and hot water tank insulation help much? And is the extra time and cost worth the return in savings of water? Consideration of use (full time vs part time camping) has to play in the factor of "waste". If you just use your silver bullet part time the recapture of expenses (wasted water) would not occur for years.
However if you are just tinkering and are up for a challenge then I say go for it. And that looks like doing a job and it doesn't look good,(not an option on an airstream) or dissassembling the interior, or installing an instant hot faucet at the sink.
1966 Mercury Park Lane 4 DR Breezeway 410 4V, C-6, 2.80 - Streamless.
1966 Lincoln 4 door Convertible 462 4V 1971 Ford LTD Convertible 429 4V Phoenix ~ Yeah it's hot however it's a dry heat!