• It is routinely done in places where there is only a small footprint available for wastewater treatment plants. Google: "membrane bio-reactors".
• A few years ago, Essex & Suffolk Water opened a conventional treatment plant for the same. It is at Langford, near Maldon, UK.

Yes. It can also be done by applying reverse osmosis on the treated effluent, which is already done in California and Singapore, or by distilling the effluent, which is done in Dubai, or even by passing the water through a constructed wetland to remove the dissolved mineralized salts.

Just watched a program last night on Science Channel where Dean Kamen, the engineer who invented the Segway, has produced a self-contained device for steam distillation of polluted water.

Called the Slingshot, it uses the incoming water to condense the steam, thus reducing the energy input.

I believe one of these units can be powered by his 1 KW cow dung fueled generators (not kidding).

http://money.cnn.com/2006/02/16/technology/business2_futureboy0216/index.htm

It can get even more energy efficient than that actually . Picture this: after using the incoming cool water to condense the steam, it is now warm . Now direct a battery of solar reflectors onto the incoming warm water to the boiler . Make sure that the water is flowing through a coiled, black-painted copper tube . The water should now be quite hot, easily 60^oC to 70^oC . Heating it to boiling point will now require far less energy than before .

Systems on spacecraft do it routinely these days.