I am a reluctant recycler. I really only do it b/c I sort of feel guilty when I don't.
I know that is probably horrifying to many of you.
BUT, we only flush our potties when there is poop. We practice EC, and we cloth diaper. The number one argument for me -- hands down -- is that I only want nice, soft pure stuff next to my baby's body. Ideally, I would like my children to wear only clothes handmade by me. My first never had any diaper stuff that I made, and I am so happy to have made a few things for this baby.
Our water is quite expensive (nearly $100/month!), and we are extremely conservative as I mentioned. Sharing bathwater, taking showers together, limited flushing and washing... Plus we have a teeny bathtub. I personally think that water argument is sort of silly. We CD'd our DS while we were in Namibia, and they have water shortage problems all the time!
10% of diaper users use cloth, so that's really quite a few. And I think the number will grow as the options become more accessible, and easier -- what could be easier than AIOs?