A picture would have helped on this i think. Ok, a closet located in the garage shares a common wall with that of the hallway in the home. There is a grill located 6" off the floor through that common wall connecting the furnace closet and the hallway. Now put a two foot high wood box in the closet and put the water heater and furnace on them. Now cut a hole in the top of the box so that it is open to vent provided in the common wall. That is the setup observed. I hope that makes more sense.