There is no baseline data available from fifties and sixties regarding backcountry water supplies. So to say that backcountry water became less safe in the 1970s is simply not possible.

That era does coincide with the '74 Safe Drinking Water Act, but to suggest a connection with the backcountry water scare, as I do, is also mere speculation.

What little data now available regarding the current situation suggests that backcountry water today is reasonably safe.

As for your friend's case of giardiasis, probably nobody can say what the relevant vector was. But it's a common disease, and not particularly among backpackers, that is normally or typically spread via unwashed hands. Day-care workers are especially susceptible.