We had an electric water heater for years, and a timer made a big difference. When we switched to a gas water heater, we got one with electronic ignition, so it was easy to use an inexpensive plug in tiimer for it, too--actually used a cheaper timer than for the electric heater, as it only has to control a low amperage ignition circuit. It would be a bit harder to do on some gas water heaters that have pilot lights---now that I think about it a bit, I'm not sure what you could do for a timer on a water heater with a pilot light. Certainly not easy or cheap. But that is why we didn't get one with a pilot light as I knew we wanted to put it on a timer.
For older gas water heaters with continuous pilot flames, you'd be surprised how hot your water will still be if you just switch the tank to pilot flame only. It will take all day for your pilot flame to heat up the tank, but if you only use hot water once a day (ex morning showers) who cares. You can also modify your tank to capture more of the heat from the pilot flame. See my instructable http://www.instructables.com/id/EVV5RP3F54HODAF/ for details, and if you're going to modify your gas hot water tank don't forget to install a carbon monoxide detector.
I think the vacation setting is the same as "pilot only". I'm quite happy with the water temp in this mode. It's good enough for up to 2 showers per morning (all my girlfriend and I need). There's no reason everyone shouldn't at least try it since it's so easy to switch back if you don't like it. Modifying the tank as shown in my instructable is completely optional but gives us enough heat for an additional shower each morning (3 instead of 2), without consuming any more gas, which means we don't have to set the tank back to "glutton" mode when we have a guest staying with us.