I listen for for context and try and take clues from the grammar. In this case though its no help. I know some have commented that headphones help but in a real world conversation you have no option for headphones.

They sound similar, but not the same. "ihr" sounds similar to English "ear" and "er" sounds similar to English "air" (imagine a British/RP accent). Have a listen to them back to back.

https://soundcloud.com/christian_duolingo/er-trinkt-wasser-ihr-trinkt

If you can't tell the difference, you need more practice. Developing your listening comprehension takes time. Also, try using headphones. This will greatly improve your comprehension.

du is when you are talking to one person eg you are a man (du bist ein Mann) Ihr is for when you are talking to more than one eg You all are women (Ihr ist eine Frauen)

Ich trinke wir trinken du trinkst ihr trinkt er,sie,es trinkt Sie trinken see also http://www.verbformen.de/ :)))

'Er trinkt Wasser' would be 'He drinks water'

If you're talking about the pronunciation of 'Ihr' and 'Er' there is a slight difference:

'Ihr' has an 'ee' sound at the beginning while 'er' has more of an 'ay' sound at the beginning

(I think, I'm not a native German speaker!)

I think the difference is the same as in English: "You drink water" vs "You drink the water". If you mean some specific water, you use "the" or "das", if it is just water, you don't.

No. ihr is just the personal pronoun for the plural you (i.e. you all, y'all). It refers to a group of people you address directly. She is the personal pronoun for just a single female person or thing you talk about.

However ihr can also be a possessive pronoun meaning her, but I believe that will come in a later lesson.

That is not a particular thing just for trinken, but applies to all regular verbs which make up the vast majority of verbs. From the infinitive form remove the -en and replace it with the correct ending corresponding to the person: trinken --> trink

ich trinke, du trinkst, er/sie/es trinkt, etc.

gucken (to look) --> guck:

ich gucke, du guckst, er/sie/es guckt, etc.

If you learn that once you can conjugate almost all verbs.

"du trinkst Wasser" is for ONE person, and "Ihr trinkt Wasser" is for you all.

Her child drinks --> Ihr Kind trinkt.

well, in english you wouldn't say I'm drinking the water, you might say "I'm drinking that water" if you were referring to a bottle or something like that, but generally you say " i'm drinking water" so that's why it's Ihr trinkt wasser

These have nothing to do with gender, but they have to agree with the person and the number. Ich trinke, du trinkst, er/sie/es trinkt, wir trinken, ihr trinkt, Sie/sie trinken.

When used as subject, ihr is only "you" as in "you all".

ich = I, du = you (informal), er = he, sie = she, es = it, wir = we, ihr = you (plural), sie = they, Sie = you (formal).

You can tell "sie" (she) from "sie" (they) or "Sie" (you) by the verb: Sie trinken Wasser = You/They are drinking water, Sie trinkt Wasser = She drinks water.

Look into the grammar explanations in the Basics units.

The form for "ihr" takes the "t" ending like the form for "er/sie/es". Ich trinke, du trinkst, er/sie/es trinkt, wir trinken, ihr trinkt, sie/Sie trinken. For the vowel-changing verbs the plural forms don't change the vowel: ich helfe, du hilfst, er/sie/es hilft, wir helfen, iht helft, sie/Sie helfen.

Well, both translate to you in English. du is used if you talk to a single person (Can you give me the salt, please). ihr is used if you talk to a group of people for example you have a family dinner and say to your family: "Thank you (all) for coming here today".

Apparently English used to have this distinction in earlier times as well, but somehow got rid of it, but there is you all or y'all used in some areas of the us nowadays which kind of reintroduces it (maybe that helps). If you have studied a latin language before you'll find the same behaviour. For French tu=du and vous=ihr.

Regarding your other question it is just a matter of English grammar. If you use you the correct form of to be is are.

ihr does not mean she, it either means you all (or old style ye) or her/their when used as a possessive pronoun.