Exactly how bad is your mileage? City is only 10 mpg if everything is right. The car is a stunner, but mileage simply stinks. Period.
I'd separate out the issues. If your other fluid levels are holding, i.e. there is no antifreeze leak, water in the exhaust could be from the environment. So its not related. See
here.
Fuel smell, however, suggests a leak. Follow your nose. The pumps and the accumulator are in the back underneath the car, trunk area. Check for leaks there. Also check if your injector holders and gaskets are tight. You might want to replace the holders and the rubber rings - they are not expensive, and any leaks there could also be the cause of a rough idle.
I had a fuel leak on my 560SEL. But it was my fault - I had introduced a fuel filter just before the fuel distributor, as an added level of protection to the unit. Inadvertently I had scarred the fitting of the filter, and it began seeping. All I can say is that you usually can see the leak if you just ran the car, before the gas evaporates. Or even better, look for it while the engine is running....