What is the model number of the timer. If it's the 91591 or 56082, you can't set the zones to run separate. Whatever you set the first zone for, the second on comes on after the first one is done, and waters for the same duration. They aren't smart enough to run separate programs. Put the mulch on top of the soaker hose, but be sure to use a pressure regulator and monitor the hose on occasion. I hear a lot of stories of soaker hose from HD not holding up very well.

How about 'misters' connected to a timer? There are some "hammock" single outlet misters for $16/ea that may work. Do you have any recommendations?

I had a wonderful timer...it had a clip on the back and I could attach it to my shirt.....and it rang until I shut it off. Alas though it wore out!. Since then I have gone through 3 or 4 others....one that was very good, Peppi gave me.....and my son who has "rock band ears"...played in a rock band as a kid and wouldn't pay attention to me about using ear plugs... anyhow he "stole" my timer because he said it was the only timer he could hear. I need one that clips to my shirt ...or hangs around my neck. I remember walking over to a neighbor's who was in his yard....and he saying "Linda, I don't know what you are timing but you only have 2 minutes left!" I need that polder one....and I need to get rid of the 3 in the drawer that you have to punch 45 times to set for 45 minutes!!

I believe you have it figured out as well as anything out there. I especially like the idea of adding a tank before the water heater. That cycle's the water and the drain valve would alow access to water when pressure is lost. 100+ gallon tanks are in common use for commercial hot water systems. You can buy any size elect or gas heater or tank only with no means of heat. The later is used with boilers and stand -by storage alongside heaters. The key to first in first out is the dip tube.