Being an engineer, I did a lot of research, both here and elsewhere, to find results of actual tests, and also to discover the science of water and smoke. Based on everything I've read, and on a few experiments I did myself, I came to the following conclusions. I should add that I have a MES 30, and I was interested in what I should do with a smoking chamber that is sealed much tighter than most other types of smokers.
Moisture on the surface of the meat attracts and absorbs smoke particles. I never read anything that contradicts this. However, how does the moisture get there? It can get there in a number of ways:
1. Condensation. If you put your meat into a warm moist environment, and the meat is cold from the fridge, water will condense on the surface, just like you've seen all your life when you have a cold beverage in your hand on a warm damp evening. This explains, I think, the statement you reference that you get more smoke onto cold meat. Some people think it keeps the internal moisture in the meat, but Cooks Illustrated magazine ran some tests which completely debunked that theory (they cooked meats dry, and also braised them in liquid, weighing them before and after, and the moisture lost was identical). The main thing that determines moisture loss is the final internal temperature.
2. Sweating. As meat heats up, the moisture from the meat is forced to the surface, and the meat sweats. This surface moisture attracts smoke. As a separate, but related process, that water evaporates. This cools the meat and, with a big chunk of meat, like a pork butt, the temperature coming in from the relatively low 225 degree smoker (typical temp) eventually matches the heat carried away by the evaporation, and you get the dreaded "stall" where the internal temperature ceases to rise for 3-6 hours.
3. Mopping. Many people mop or spray their meat every hour or two. This adds flavor (the mop is usually some sort of sugar-based liquid, with a little booze thrown in, just to make the meat "happy"), but it also provide surface moisture to attract more smoke. This explains why it helps build up bark.
So, moisture from the water pan can add to the moisture on the surface of the meat for the first hour or two, when the meat is cold, and the moisture condenses on the surface of the meat. After that, I haven't seen anything that leads me to believe that moisture from the pan does anything for the meat, either by increasing smoke absorption, or by helping retain internal moisture.
In some smokers, the water in the pan helps stabilize the temperature inside the smoker, because water has a large heat capacity and therefore takes a long time to change its temperature. With smokers that have thermostats, like most electric smokers, this feature isn't needed at all.
So my initial conclusion, with my MES, was that I only needed enough water to last for a few hours. So for many months I was adding 1-2 cups of boiling water in the pan at the time I added the meat. Since the water was already hot, it immediately filled the smoker with moisture, and I got condensation on the cold meat. By the time the meat got warm (70-80 degrees) the water had mostly evaporated. Someone in this forum suggested this method.
However, I then realized that I could simply spray a mop on the meat and get the same thing. Since the water pan is a pain to fill, drain, and clean, and since the condensation from the water pan would drip down the MES door and leak out the bottom, I eventually nixed the water in the pan. Since the smoker has a thermostat, I didn't bother to fill the pan with sand.
So I am no using water at the moment.
But, I may go back to it, or do the sand trick because I have found that I am getting a lot of radiated heat from the heating element, and that when I do smoked almonds one tray will burn and the other will be fine. The heat distribution inside the smoker doesn't account for this, and I think I need the thermal mass of either sand or water to protect the food from the direct heat of the heating coil.