Fenwick,
I'd repeat your little experiment to check that...
...the 'leak' wasn't just water going over the top of the membrane liner 'sock' sewn into the shoe. Quarter fill the shoes... wait... is water leaking? Half fill them... wait... is water leaking?... Three quarter fill them... wait... is water leaking?... you get the idea. Water could also be wicking over the top of the liner sock and back down the outer fabric of the shoe. A bit less likely but not impossible.
If you are still sure that there's water passing through the fabric of the shoe from inside to out (rather than over) then you've got a leaky membrane. No amount of reproofing will fix this; I'd take them back to the shop and be politely assertive...!
If, however, you suspect that water is wicking over the top of the liner then perhaps a hydrophobic treatment (replacement DWR type) might help things. This kind of wicking is a common fault in lined waterproof jackets where water is drawn up the sleeve lining.
I agree with Pete about unlined approach shoes being preferrable but it's a personal choice. We were recently discussing it here. If the shop won't do anything about the leak, then you could always try using a goretex sock inside them.
As for the smells... two things to note. Most 'body odours' are the result of bacteria feeding on lipids (fats) that are secreted body oils in sweat. The bacteria's waste product is what smells. Killing the bacteria is a temporary solution (using a mild disinfectant in the wash for example) but the only sure way is to remove the residue of oils from the shoe. Not easy, especially if you are washing them in mild soaps. As a last resort you could try leaving them to soak in a bucket of warm water with a capful of biological washing liquid. The enzymes should have a chance to remove these oils. Then rinse....rinse...rinse... and rinse some more. This might not be great for the dwr coatings but if it's a choice of binning the shoes or attempting this, then I'd go for the washing liquid. Then reproof as needed.
John