Here's part of the old water heater, sitting on a hand truck. You can see the horrible corrosion. Lisa says there was still water in it, and she helped Steve wrestle the thing outside where Steve was eventually able to un-thread the drain plug to get the water out. But if we thought the water heater was bad, the furnace was worse.
This is the area of the closet where the Furnace of Death was installed. What you see here are scorch marks on the wall where the furnace was attempting to set the house on fire. I guess we're lucky the previous owners never managed to do so, or else we would not have been able to buy a house that we like (warts and all) in a place we like.
Steve's fee (which seemed quite reasonable to us) includes the labor to remove the furnace and water heater and to pay for their disposal. We'll return to him and his employer when we're ready to really bite the bullet and install new ones. In the meantime, Lisa can go to work cleaning out the closet in the kitchen where this mess was and making plans to cut it down in size and convert it to a pantry on account of the new appliances will go somewhere else when we get them.
So it appears that when it came to the existing furnace, we had the choice between being gassed to death or dying in a fire. I'm glad we selected None of the Above, and to anyone who suggested that Steve was being alarmist so he could get us to pay him for work we didn't need, I submit these photos as a reason why Lisa trusts Steve completely.