We have 5 children ranging from age 10 to 18 (the oldest has just graduated from our homeschool and she is preparing to enter the convent in August) and we generally do a load of laundry each day except on Monday when we have to do extra laundry since we don't do laundry on Sunday.
I have no idea why families would have to do 4 loads a day unless they have the older model small capacity washers.
I think it is for separating colors. We have pets, and they definitely cause more laundry and more cleaning of everything.
I am a firm believer in regular bathing, and I sincerely thank God for the luxury of running water. I have never taken it for granted, not since I spent a month in Jamaica and another month on a tiny island with no running water.
Also the tenant farmers at our old farm only had a pump and an outhouse when I was little. It was so daggone hot I don't know how they survived growing tobacco, except it was very clean overall, and the water came from an Artesian well.
I get being frugal and think it is prudent to teach our children to make sacrifices, though.