Yes, rather than saying "salt substitute" they could have said something more meaningful to US consumers who mostly wouldn't be used to adding salt to a dishwasher's water softener, such as "contains water-softening ingredients to protect your dishwasher and dishes against film, residues and build ups, leaving nothing behind but sparkling shine." I should have gone into marketing LOL.
Although all (or virtually all) dishwashers in Europe have a water softener, I do wonder what percentage of people fill it with salt. And of those who do, how many think of it as a "salt dispenser" and have no idea what it's actually for. Especially now that the most popular detergents are all-in-one and are supposed to work without the addition of rinse aid or salt.
Yes whole-house softeners are definitely a thing in Europe. Well in the UK and Spain at least. Here in Spain they are generally large units (same as in the US), either all-in-one or with the separate brine tank. I think they are about as common here as in the US. Some parts of Spain have soft water, other parts medium and other parts hard. I think water softeners are somewhat less common and possibly more expensive in the UK and are often smaller units that can actually fit under the kitchen sink! Some even work without electricity. Reverse osmosis units are also common here in Spain. In fact, all the apartments in my building were built with the water line to the fridge passing via a loop under the kitchen sink making it RO-ready, should the owner wish to install an RO. My building also has a "whole-building water softener" that removes the worst of the hardness from the water for all the apartments, but doesn't soften it completely by any means.
As for the definition of hard water, it depends who you ask! My parents in the UK have water that is 6 US GPG and their water company classes this as slightly hard.