I am concerned that your kitty is getting very thin even with a normal appetite and attitude. I understand that she has been drinking quite a bit of water and has foul breath odor as well.
Her breath odor may be related to dental disease (very common in Persians) or it may be related to changes in gut bacteria or a build up of metabolic toxins secondary to whatever disease is leading to her weight loss.
When we see weight loss with an apparently normal or increased appetite we need to worry about disease processes that either don't allow her to digest and/or absorb the food she is taking (such as diabetes, liver disease, primary intestinal or pancreatic disease including cancers) or those that lead to a higher metabolic rate such as hyperthyroidism or cancer.
In an older cat the more common diseases we see include hyperthyroidism (a tumor of the thyroid gland that overproduces thyroid hormones) or since she is drinking more and urinating a tremendous amount, diabetes. Sometimes early on with diabetes we see weight loss and increased drinking but until they become ketoacidotic then may not seem "sick".
Both diabetes and hyperthyroidism are treatable or at least manageable.
Hyperthyroidism is controlled with daily oral medication (Tapazole, also called methimazole) or a very special diet called y/d both of which must be done for the rest of her life or treatment with radioactive iodine to selectively kill tumor cells which is usually a one time therapy. There are pros and cons to each therapy which your veterinarian can discuss with you after getting a firm diagnosis.
Hyperthyroidism is not painful, but elevated thyroid hormones can make them feel extra spunky and active, increase the heart rate and interfere with sleep, like drinking way too much coffee or energy drinks. Long term if left untreated it can lead to heart disease, hypertension, possible eye damage as well as kidney and liver damage. But if caught and treated many of these things can be reversed.
Diabetes is controlled with diet and insulin therapy.
Has she had any testing done to achieve a diagnosis?
Ideally she should have a complete blood count and biochemistry profile with T-4 checked as well as a urinalysis. These tests often give us the information that we need.
If those aren't diagnostic then it is time to move on to more specialized testing. I recommend checking vitamin B levels to look for signs of intestinal disease, a test for pancreatic insufficiency called a TLI, and an abdominal ultrasound to look for signs of changes in the walls of the intestines as well as evaluating his organs. She may need an endoscopy to collect biopsies of her intestines if they look abnormal.
If she has any evidence of dental disease then she may need some radiographs of her mouth and tooth roots. Although dental disease alone rarely leads to weight loss it could be contributing to her breath odor. Diabetic cats with infection in the mouth can be very, very difficult to get properly regulated. So if she has dental disease it may be necessary to have a thorough cleaning and treat any infection to get her regulated.
In the meantime you might try feeding her a higher calorie prescription food called Hills a/d or Iams Maximum Calorie from your veterinarian and make sure she has access to plenty of fresh, clean water.
Please let me know if you have any further questions.