water heater

The valves will be inside where the water pipes enter and leave the water tank. Mine has a three valve bypass. When the upper and lower valves are open and the center valve closed, water flows into and out of the hot water tank. When the upper and lower valves are closed and the center valve open, water bypasses the hot water tank and goes directly into the hot water lines. There are also two valve and single valve hot water systems. The bypass is used when winterizing so you don't have to pump gallons of RV antifreeze into the tank before any reaches the hot water lines. Just to confuse matters there are also two valve bypass systems and single valve systems. If you're not sure, get some help. Don't heat the water tank with no water in it.

I'm not sure what the two switches you mention do. I have a single switch on the outside of the RV on the hot water tank to turn on the electric hot water option and one inside to turn on the gas option. Since the switch for the electric option is jammed to the off position, I've only used the gas option.