By cistern-driven, I mean stored in a reservoir (of whatever type) in the house, which is itself fed from the cold main. This can either be a tank in the roof that feeds a boiler, or a storage tank with an immersion heater. I think the idea was that contaminants (bacteria, dust, etc) could easily get into these things, which people rarely inspect or clean. Same applies to water-based radiators, often full of chemicals and stinking sludge.
Domestic hot water pressure is usually much lower than cold to prevent cross contamination. Our mixer taps tend to mix at the head rather than the base, go you still get hot and cold parts of the "mixed" water and separate hot and cold taps, though this usually just applies to the kitchen which has cold direct from the main. Bathroom stuff often uses a tank in the attic for the pressure, so I think you can mix the hot and cold in that situation. I do remember being told when a kid not to drink from the bathroom tap. Bit daft really.
It's quite an old bit of law, I imagine modern pressure controls and valves could fix the problem, but a lot of our housing stock dates from 1850-1950
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