The heater core is essentially the exact same thing as a radiator, only much much smaller. It takes hot engine coolant, and circulates it in a small radiator. The blower motor is connected to a fan blade, which blows cabin air thru the heater core (small radiator) and into the cabin of the vehicle. When the heater core develops a small leak, the 'steam' looks like smoke, and enters the cabin. It will have a sweet smell. IT DOESN'T MATTER IF THE HEATER IS ON OR OFF, THE LEAK IS STILL PRESENT. So it's something that needs to be either taken care of, or bypassed.
If you wish to simply 'bypass' the system, unhook the two heater hoses which enter the firewall from the engine bay, as these are the supply and return hoses to the heater core. Use a simple piece of pipe, or, a 'flush kit' connector to connect the two hoses together. This eliminates the heater core, and removes the leak from the cooling system until such time as you can properly repair the system. However, you're going to get cold.
The heater core is encased in the heater box, which encompasses virtually the entire ventilation system. It's a huge Pain In The Arse to remove, as will require major dash removal. Make sure to order the replacement heater core in advance of dissassembly.
1992 YJ, 401 V8, EFI, TH400, Atlas, D60s, Detroits, Warn 8274, Cage, 37 Krawlers
1997 TJ, 350 V8, EFI, TH400, Atlas 4spd, D60s, Detroits, Warn 12000, Cage, 40 Kevlars
TTC 1994, TTC 2012, Trail Tour participant.