I saw something, recently that might work. . . a bamboo windchime that hung from the eaves, almost to the ground. The thick pieces of bamboo were long and notched in places to give different woody "klong" notes with they knocked together. They also worked as an effective screen for some sort of installation behind them.

I like the bomboo idea - very zen, is it not?

I was going to suggest building a cabinet around it, as you would if it was in your kitchen, painting it to blend in with the adjacent wall - build the calm. mmmmmmmmmmmmmm!

Ornamental Bamboo Fence, 60"L x 48"H · More Info

How about a bamboo fence in front of it or a can be boxed out with bamboo.

Bamboo Fence Panel, Prebuilt Panel, 36"Wx72"H · More Info

I have also had clients put a vine trellis in front of the water heater (custom cut out so it goes around the heater) and grow a vine up on it.