I don't think you could have said it better chetlaham. I've preached time and again: Why is money being funneled into trying to make appliances use less and less, when instead that money could be invested on finding and engineering better, more efficient ways to produce energy and refine our water. Building a machine that is more efficient is ultimately a good thing, but it's being pushed to all the wrong limits. Just like you said though, they'd rather just say "use less" rather than update our ancient power grids and water treatment methods. I think, and hope, that it will reach a breaking point. With electricity, I'd gladly take a motor that can output the same power and volume as an older one, but only use a penny's worth of energy, but as far as water, there's only so little you can use before the job isn't being done at all. And what are they going to do? Tell physics to change so that a drop works the same as a gallon? Tell humans and plants that they have to evolve to need less water? I don't think so, although I wouldn't be surprised if they tried.
At the bottom of it all I don't blame the manufacturers. They receive funding only on machines that meet those strict regulations. Anything that doesn't is out of the company's pocket, which may be why the "BOL" Whirlpool agitator model is $500, when that used to be average price for a higher end machine. I am glad that they still offer that model though, because it at least still gives the consumer a choice if they want a washer that still works like a washer. If Whirlpool were to drive sales and features to the new trendy HE dishwashers, but have one model that was a standard tub PowerClean, with basic cycles/features like Heavy-Normal-Light and Hi Temp wash, I would absolutely pay more for it. As with anything in the consumer industry, the consumer themselves should have a choice in what they're spending their money on.