I am a big supporter of bathing with your LO. My DP and I take turns doing so with our LO. It really helps her comfort level. As she is getting more active we'll probably have to stop, but I must admit that I will miss it, my DP says the same. Also toys are a must have. They make bath time fun, and they're a great distraction for LO's. Try to avoid running water while he's in the tub as that will scare him more. Just use the bath water, try to make it fun, sing, laugh, talk, play.
As for rinsing her hair, we have some stacking cups in the tub that are toys for her, we use then to pore water over her head, if your using baby shampoo you wont have to worry about it getting into her eye's, just try to tilt her back slightly if you can. For DD its a big game, she's even starting to try and do it herself. I usually just put cup her forhead with her hand to keep most of the water out of her eye's.