The shower in my master bath is tiny. When I removed some dry wall to see if I could widen it, I found a large ~10" round vent running through the space(must be the furnace). Now that I have a high efficiency furnace it seems I no longer need such a large vent since only the hot water heater uses it. I think the furnace installers inserted a chimney liner to reduce the draw. If I could get by with a 4" or so vent pipe, I would be able to expand the wall by 5" inches or more (not sure if there are code restrictions on how close framing can get to a gas vent). Another idea is to vent the hot water heater out the exterior of the house, but I"m not sure if this is even possible.
This is one of those questions that is very difficult to answer properly with the info given. Although it sounds like you may be able to downsize the vent/flue because to the change over to a high efficiency furnace, there are lots of considerations depending on the exact equipment you have. The water heater is a different application as well.
In your particular case, I think it would be wise to bring in a qualified HVAC tech to analyze the situation and give you a safe plan ideal for your needs and location. Never cut corners when fire and poisonous gas hazards can result. Good Luck