Human civilization uses a lot of water. We drink it directly, use it for cleaning, and pour tons of it on our plants for farming and gardening. It doesn't come from magic. We take it from nature. Various lakes and streams and rivers. (Though smaller sources like ponds tend to be a bad idea. The water gets stagnant and things start to grow in it.)
After we've used the water, it tends to be unappealing. If we washed things with it, it's now full of dirt and soap. It may contain sewage. In the old days, we'd just flush it straight back into the river. The river did tend to take it away where we never saw it again. We now know that all rivers eventually go to the ocean, and the ocean an only absorb so much before we get horrible blooms and such.
Since then, we've learned to chemically clean water. We add a material that sticks to the dirt and bacteria and soap and whatever other additives. We run it through sand and charcoal. We expose it to ultraviolet light to kill off what bacteria remains. The end result of this is cleaner than the water we got from the stream in the first place. And yet, it's been proven in Singapore and Australia, two places with a desperate shortage of water, that people are still grossed out by the idea of recycled water. (And yet all water is recycled. In nature, it's filtered by clay and such before flowing back to the river. The clay does a very good job, but it is quite limited in capacity. Put more than a certain amount of water through it and it just stops working at all.)
So if people won't touch this filtered water, the next best thing, and the thing that I'm 99% sure actually happens, is to return recycled water to nature. No more infected, polluted rivers. No more harmful algae blooms from detergent. And yet, this could be better.
Studies of river water with returned water show traces of pharmacology byproducts. The metabolic transformations of the pills people took, peed out, and survived the filtering process to return to the river. Sometimes they combine into hormone-like chemicals. News reports feminized frogs, where various pills combined to form a pseudo-estrogen, the frogs absorbed this and feminized.
I suppose the only way around this is to find a better purification system. The only way I could be totallly sure would be to electrically separate the hydrogen from oxygen, and then burning the hydrogen to recombine them. (and condense the resulting steam, of course.) This is not energy efficient.