I spoke with Dr. Paul Ballentine, an MIT and SUNY Grad with expertise in Thermodynamics and he said turning off a hot water heater at anytime is a good idea. Paul is very active in the green energy community in Austin Texas so I consider him a pretty strong source.
The reason people think it is not a good idea, according to Paul, is that there is a misconception that hot water heaters consume more energy when they are starting up.
I personally searched the web and could not find anything that said that hot water heaters consume more energy on the startup phase. So you can feel assured that it is OK to turn off the hot water heater (assuming turn on is easy) and you will save energy.
Here is a reference to a nice simple model from Lawrence Berkeley National Laboratory. Notice that there is not a penalty variable in the formula for startup!
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