I had this situation on my grille when I first got the car - it seems to be a very common problem. I ended up replacing it with a new one (expensive!).
I think there's a venting system already built in to it to take care of condensation, the key to fixing it is to stop the major leaks. What I was going to do (before I replaced it
) was take it out and seal the seam all around it with silicone (after making sure it had dried out real good in the sun over a few rain-free days). It would be worth a try and what I'll do if my current one does it.