The student pilot elected to go flying after finishing work at a local pizza restaurant, which he stated was his habit. His wife and 3 friends accompanied him. He reported that his preflight inspection did not include draining the fuel gascolator, as listed in the owners' handbook. The first take off attempt on the same flight was delayed when the engine quit during runup. The pilot believed the engine had quit because the primer was not fully closed. After pushing the airplane back to the ramp, it remained stationary until a second start was accomplished. During the ensuing initial climb after take off the engine lost power. The pilot said the airplane began turning and diving to the right so, he tried to apply back pressure to the yoke and a little rudder. He stated that he heard the stall warning horn when the engine power decreased. The airplane was equipped with a stall warning light, only. The pilot had recorded 4 flights in a Cessna 152 and 7 flights in the PA28. Passengers on the airplane stated that after take off the nose was pitched up abnormally high, then the airplane rolled and descended to impact. Examination of the fuel system revealed water contamination.