Definitely take the Water bus.

I'm not positive, but I think the hotel you are staying at is near San Marco Square. If it is then you would take bus number 82 from the train station to the square.

It will take approx. 20-30 min to get there and cost you roughly 8000 lira. Which in Canadian dollars works out to be just under $6.00. There is also an additional charge for bringing on luggage and that charge depends on the quantity and size of the stuff that you have.

If I remember correctly it cost my wife and I in total no more than $25.00 cdn. with all our stuff.

The water taxi's will charge you anywhere from 150,000 lira to 200,000 lira. ($100-$150 cdn.).

Incidently, the Gondola rides in Venice will cost pretty much the same as the water taxi, if you go it alone. If you share the Gondola with other people, then the price will come down.

Also don't take the Gondola first thing in the morning. I know that this will sound funny, but you will find yourself in a bit of a traffic jam. Not quite a highway 401 traffic jam, but enough of a congestion problem that it may take away from the thrill of it all.

Well I hope that this helps.

Have a great trip.