Ok, lots going on here.
1st
you should have the fan set to auto on the thermostat. Press "mode" till you see "fan". Then press the up/down key till it says "auto". That should fix the fan (not the a/c) turning on with the heater.
2nd
The heat, and hot water have nothing to do with each other. The heat is turned on with the thermostat, and the hot water is turned on by the switch next to the water pump switch. For heat, Again press the "mode" button till it says furnace, then the up/down to set temp.
For hot water, turn the switch next to the water pump on, OR you can use electric hot water (if you're plugged in) by using the switch located outside in the lower left corner of the hot water furnace. It's hard to see at first. Be sure you have water in the hot water tank before using. Check this by Pulling the emergency pressure release handle up, it should let water squirt out if there is water in there.