Pardon the grammar, but if ain't broke don't fix it! Allow us to explain. The fact that you are experiencing condensation on the interior of the windows in your home is of no surprise to us especially considering the age of the home and the type of heating that exists.

Chances are that unless you have replaced the original windows in the home with new insulated units or have installed storm windows you are more susceptible to condensation for the very reasons you stated in your letter. The vast difference in temperature between the interior of your home in the morning (usually very warm), and the exterior (usually very cold), results in condensation or "sweating" at the location where this exchange occurs--on the inside of your windows. Thermal pane or insulated windows that contain an air space between two separate panes of glass are designed to minimize the transfer of air thereby significantly reducing the condition for condensation to occur.

Another likely reason that you are experiencing this condition is due to the lack of ventilation or air circulation in your home. Unlike modern gas-fired forced air furnaces that contain blowers that move the air throughout the home, your little gem depends on gravity to heat the home. Now we're not knocking your gravity furnace we just want you to be aware of what one its drawbacks is that may be contributing to your problem. And your furnace installer was partially correct when he suggested that the "fumes" leaking from the furnace were contributing to the condition. We believe that what he was implying was that there is a certain level of condensation that is released as a result of the natural gas burn off in your furnace, although chances are that this is only a fraction of the problem.

We suggest that before you consider replacing what has served you well for many years that you look into the addition of a thermal pane to your existing windows and or the installation of an auxiliary fan that will significantly improve the movement of air in your home. Your local office of Pacific Gas & Electric should be able to assist with information regarding your windows while a call to a reputable heating and sheetmetal contractor should address the fan.