Unfortunately, I don't think you're ready for this, at least not if you want to have a direct confrontation.
The waiter is level sixty-five, and has over 1,200 health. Your Lifeblood does 57 damage per hit, but let's round that up to an even 60. To my understanding, the numbers displayed in the UI are inclusive of any skill perks, so we don't have to account for those, and I don't believe the waiter is wearing armor. So you need to hit him over 20 times to kill, not accounting for his use of Drain Life. Drain Life does 3 points of damage per second and heals him for the same amount.
At level 17, your health can be no higher than 270, and is probably lower if you've invested in stamina or magicka. Armor does not prevent magical damage, so we can mostly ignore your plate armor (except for the gargoyles' physical attacks). Warhammers are relatively slow and take multiple seconds between hits (on average, allowing for you and the enemy maneuvering, etc.), so at best your health-siphon enchantment is (not quite) cancelling out his Drain Life spell, but going by UESP's description of other vampires, I am assuming that he knows other spells which do more damage than that, plus we have gargoyle damage on top. To add insult to injury, the fight will almost surely go on long enough that you contract Sanguinare Vampiris, which applies a flat -25 maximum health penalty, which is probably around 10% of your health (higher if you've significantly improved your magicka or stamina). So you are taking quite a lot of damage, for not very much health, and I simply do not see any realistic way that you can beat this guy in a straight-up fight.
Can we improve your character enough to win? Maybe:
- Argonians may be able to use Histskin here (10x healing for 60 seconds), but by itself, I think this is probably not enough. It might combine well with some of the other strategies listed below.
- Bretons can use Dragonskin and the Atronach Stone to become temporarily immune to magic damage (for 60 seconds). This reduces magicka regeneration (and takes away the benefits of other standing stones!) but you probably still need to improve your armor rating. Bretons also have passive 25% magic resistance, which stacks with absorption (absorption is probabilistic - X% absorption is an X% chance to completely negate one spell hit).
- Orcs and Dark Elves also have useful greater powers, but they are very unlikely to do enough by themselves in my opinion.
- The Lord Stone, combined with completing The Book of Love, gives a total of 40% passive magic resistance. You can enchant or use alchemy to get another 40%, but 80% is the cap. This is probably not enough by itself, given your health is so low. The Lord Stone also provides an armor bonus, which may help with the gargoyles.
- Flames is probably not going to do enough damage by itself, even with the vampire's weakness to fire. Higher-level destruction spells may be viable; Incinerate's base damage slightly exceeds the actual damage of your Warhammer, and then the vampires are weak to fire. If you are short on magicka, I would recommend siding with the Dawnguard, leveling Restoration, and then picking up Vampire's Bane from Florentius, as the sun damage spells are much cheaper per unit of damage. However, even then it might not be enough, as Skyrim's offensive spells are generally underpowered above level 40-ish.
- As a secondary issue, 167 armor rating is rather low for a full set of Daedric plate. Improve it further at a workbench to resist physical attacks from the gargoyles. You may need to improve Smithing in order to do that. This process will level several different skills at once, including Smithing. If you already know how to smith Dwarven stuff, then it may be more efficient to just smith a whole bunch of Dwarven arrows instead, because Dwarven materials are ridiculously abundant if you bother to pick them up.
- The Heavy Armor perk tree will also improve your armor rating, once you level it up some more. This will happen naturally as you play the game "normally"; the skill improves when you take damage while wearing heavy armor. Don't forget to spend perk points on the first perk in the tree (Juggernaut), because that perk is really five perks displayed as one (i.e. you can buy an improved version of it once your Heavy Armor is high enough by selecting the perk again).
- Also, you probably want to improve the warhammer further, or upgrade to a better weapon.
The bottom line: You either need to cheese the encounter somehow (i.e. avoid a direct fight and kill him using stealth archery, or something like that), or else you need to greatly improve your character, before you will be ready for this fight. I think it's unlikely that you can do this at your current level, but with enough min-maxing (see above), I suppose it might be possible? But you will probably enjoy the game more if you just go do some other quests and get back to this one once you're significantly higher level.
