I thought that water valve worked the opposite way, it shut the hot water off when the AC was turned on? Either way, maybe the vacuum line for the dash ducts is missing or the ducts are stuck closed or the vacuum reservoir/amplifier is broken or missing. It's that black ball near the heater/AC components. When you shut the car off, try moving the heat controls. There should be enough vacuum to operate them a bit before the vacuum is lost, and you will hear them moving. At operating temps the hoses to the heater core should be hot. If not, either the core or hoses are blocked. If that's the case try backflushing them out. Is there a proper thermostat in the motor? It may be stuck open.