Any unvented fuel-burning heater will produce water vapor as part of the combustion process. IOW that will increase your humidity and make any condensation issues worse.
I use the Boeshield T-9 in the shop and for many areas on my boat.
It works really well.
Before I learned about the T-9 I used to use plain wax and/or a canvas drop cloth as a cover.
The Snap On ones are 3mm thick through 11mm. Then 4mm.
They are really nice.
I just picked up four a couple days ago. 8/10, 10/11, 12/14, 13/15.
So you get two sizes on each wrench.
I paid from $25-$40 each.
Hope that helps some.
I recently bought this refrigerated air dryer (29 CFM) with my new compressor for $750.
http://www.eatoncompressor.com/catalog/item/506941/1017584.htm
I would think that with 15' to 20' of pipe after your current compressor and before the dryer you could use it.