Yes drain the tank a bit and that cold nipple sticking out of the tank has a plastic tube on it, there should be roughly 30 ish inches of plastic on the end of the nipple. So yeah pull it out, make sure you have Teflon tape and preferentially dope as well so when ya install the new one it'll be good to go. I believe rheem has one specific to their tanks so make sure you grab the right dip tibe. For the drain what I've done and sometimes works is drain the tank for a bit, even if it trickles, and turn the water on fairly fast and it should stir some sediment up and hopefully drain it out. I'd fix the dip tube first, if you fix that then it'll reach the bottom of the tank and it'll stir the sediment up more to get it to drain better. Usually what'll happen is sediment builds up, settles at the bottom and then blocks off the drain port basically so all you get is a trickle. Also while your at it if you have a plastic drain/sediment faucet you may want to replace it with a brass one, I've had tons of those leak on me. They're junk. Another thing you could do is if it has a separate anode rod, pull it out and replace it as well. 1 1/16 socket i believe to replace the anode rod. If you replace all this it'll be like 50-60 bucks in parts and you'll practically have a new water heater. You could also trip your relief valve and make sure it works, if it drips afterwards then you'll need to replace it. These are just optional but things to consider. Usually water heaters that aren't maintained properly will last 10 yrs roughly now a days. If ya replace anodes regularly like every 5-6 years it'll probably double its life.