I stay at a campground during the summer occasionally that has tankless Rinnai water heaters. They are a bit more pricey, selling in the $1000 to $1800 range depending on size and options. (They need powerful ones at the campground to run multiple showers) Those water heaters give an AWESOME shower! You will NEVER run out of hot water with a tankless water heater, so you can take a shower as long as you want to, and other can take showers immeditely without having to wait for the tank to heat back up.
The Rinnai water heaters at the campground seem to do their best when two showers are running at a time. With more than that, the temperature starts to get a little cool, but still plenty useable for a shower, but maybe not quite for a dishwasher or a washing machine at the same time. (the mens and womens rooms have their own heaters, each bathroom has 4 showers) With just one shower on, the water sometimes gets too hot, and then when the user cuts the hot water valve back enough to be comfortable, the burner would shut off. The plumbing company the campground uses solved many of the temperature balance problems by putting an electronic thermostat on the water heater. Inexpensive models without automatic temperature controls may give you this issue too, especially if you use the newer water saver low-flow shower heads.
The drawback to electronic control and ignition is that the units require power, and if the electricity goes out in your house for some reason, you will be stuck without hot water too. For those of us that are familiar with having gas hot water, we have always took for granted the fact that you can still have hot water without electricity. This was an issue at the campground because the power went out frequently with summertime storms. It was solved by running the water heaters off of a computer UPS...they do not take much power at all.
I imagine the household models you guys were looking at may not be quite as powerful or sophisticated as these high-end Rinnais. If two people are taking a shower at the same time (not in the same shower!) or if you are filling multiple washers, you may run into a lack of heat problem simply because the heater cannot heat it fast enough to keep up. Check the GPM rate of the water heater you are interested in to see if it will fit your needs.
I am sold on tankless water heaters simply because of their convenience. The energy savings is an added bonus. The fewer people in your household, the more savings you will see with a tankless. Especially if they are like myself, and take showers at the gym frequently. They do take a little bit of a change in habits. While you do not need to wait to take a shower right after another person, you do need to be mindful on how many hot-water appliances you run at the same time. Oh, and one other thing...make sure your water heater is as close to the water "destination" as possible. There is a slight lag time in the water warming up, as the coils and other hardware in the water heater warms up when hot water is called for. By minimizing the plumbing lengths, you also minimize this lag time.