I have looked at the same thing, no to detect if it is off, but to be able to torun the tank on and off. We have a solar hot water tank and through summer you dont need the power/gas on to heat it up that extra bit, so at the moment we turn it off manually. get a couple days of rain and if you have forgotten to turn it back on you end up with a luke warm shower.
I am planning on using this
http://www.temperature.com.au/download.aspx?name=SD%20012tx%20Ex%20ia.pdf
The "hockey puk" gives me a 4-20mA output that goes into the M1.
The probe is inserted into the top of the tank at the outlet. normally the outlet pipe comes out and then turns, but with a small modification, an extra tee the temp probe will insert into the outlet of the tank and not significantly block the flow of the water.
Temperature is merasured at the end of the probe. you can order these as long as you like so you can get into the middle of the tank if you wish.
Some tanks also have a second outlet (and inlet) on them (left hand and right hand). you could just stick thin into the spare outlet that would normally be blocked off.
You dont get to select at what height you want to measure your tank temperature with this method, but it should do the job that you need it to do.
Mick