Time marches on and work continues on the water heater cabinet. I've now mounted two drywall panels to the metal frame and things have come together quite nicely. First I cut, fitted and affixed the left wall panel as shown here.
Then I cut the right drywall panel to size. Once that was done, I cut out the vent holes by holding the vent grill to the drywall; scoring the vent interior edges with a nail, drilling four pilot holes, then cutting out the vent hole using a jig saw. After that, I drilled two small holes for #8-10 1" screw anchors with which I affixed the 6"x14" vents.
Bolting the drywall to the frame was a bit of a maneuvering trick, but was nonetheless accomplished just minutes later. The high vent's uppermost edge is 14" from the top and the low vent's bottom edge is 18" from the floor. This arrangement allows for optimal air flow for this unit. Next I'll fashion the drywall segments for the front and then it's on to applying the drywall mud and drywall tape.