The makers of The Story of Stuff have a new video about the "manufactured demand" of expensive bottled water. (Xeni posted a teaser a couple of weeks ago.)
When Fiji water launched an ad campaign that made fun of Cleveland tap water, the city of Cleveland ran tests comparing its water to Fiji water. "These tests showed a glass of Fiji water is lower quality, it loses taste tests against Cleveland tap water, and costs thousands of times more. This story is typical of what happens when you bottled tap water against tap water."
Personally, I filter my Los Angeles tap water because I don't like the chlorinated taste.
The Story of Bottled Water