Water Heater Recommendations?

I am looking for recommendations for a 40 or 50 gallon natural gas water heater. Ours is at least 16 years old, and has recently started making noises like there are marbles rolling around inside. Also, we have noticed a gradual, yet significant, reduction in the amount of hot water we get.
I've investigated going tankless, but it really won't work in our situation. We live in a rowhouse and would have a very hard time finding any place we could vent the unit according to code. Additionally, I just don't want to fork over the cash upfront at this time.

Now for some answers to your questions:
Standard gas tank heaters have a similar efficiency. They will typically have an energy factor of .56-.58 The cost is around $300-500 for the unit and they all tend to last about 8 years. There seem to be a lot of complaints about the Whirlpool Flame Lock heaters... you can search this site for the details. Bradford White heaters get good praise, but I don't know if they are really superior and if that translates to anything meaningful for the owner.
A power vent gas tank unit (which uses the fan and may use pvc vent pipe) may have a slightly higher energy factor. The usually cost $1200-1500 and the main attraction is that they can solve venting problems. The burner won't work unless the fan is running, so you don't have to worry about that. The downside, besides the cost, is the fan adds additional point(s) of failure.
Standard gas tankless units have an energy factor of ~.85-87. They can be vented through a sidewall but require Stainless Steel venting that is expensive. Cost is typically $800-1200 for the unit + vent. They can solve venting problems, space problems and provide continuous hot water. Note that the cost is about the same as a power-vent tank unit. If you go this way, you need to do your homework on min flow rates, proper sizing, venting and gas line sizing. They save about 39% on energy costs over standard tank and may have tax and utility incentives. Avoid Bosch units.
Condensing Tankless: Energy Factors ~.93-.95 They vent through PVC pipe thereby solving the cost issue of the SS vent. All of the other benefits of tankless. Cost generally $1600-2200. These aren't generally worth the price difference from a standard tankless unless it solves a venting problem by using affordable vent materials.