Gosh, I'm extremely appreciative of everyone's input-- thank you for writing-- all you people with all these experiences I haven't had (yet!)
Generally speaking, I'm leaning towards the "sure bet" crowd here-- that is, investing in the certainty of cisterns+hauling or rain catchment or possibly treating the lake water supply to an acceptable potable level-- versus the hit or miss approach and risk of continuing to drill new wells.
Regarding the lake on our property, it is a private lake with seven acres of water, which we own entirely. I am told it is a basin from a watershed of 85 surrounding acres, and there are a couple of small inlet streams and one outlet stream, the flow rate of which we control. We use the lake principally for recreation, kayaking and and swimming in the summer. It had been stocked with trout five years ago and has many frogs, resident birds, etc. While swimming one notices distinct cold patches in the water, which I'm told might be upwellings of groundwater. I had the lake water tested for bacteria before I purchased the property and the analysis came back exceptionally clean-- the county said anything less than one thousand parts per million E coli was acceptable for swimming and the our lake water had three parts per million. The lake water appears clear (not cloudy) but medium brown in color, like tannin. We live in the rainy northwest and the lake stays nearly full all year, drops a few inches in the summer, not much and fills to overflowing with the winter rains.
I need to find out the county regulations-- I have heard that using rainwater catchment for domestic general use is not permitted in this county, though it is permitted in an adjacent even more rocky county. I have no idea but somehow I imagine the water department would also have a dim view of drawing/treating lake water for general domestic use-- don't get me wrong, I see all the viable reasons to do it, I'm just not sure it's permitted.
Don't forget, I do have another water source now-- the old 40 foot deep well that went dry in August of 2006 is flowing again but with arguably much more iron. When I purchased here, I began by putting in an elaborate water treatment system to improve this well's water quality, which was coming out at the house all murky brown and smelly. The former owners had invested about $12,000 of Kinetico components which when I arrived here had not been used or maintained in many years-- everything was set in bypass mode, as though that system had perhaps not worked well enough to even be worth maintaining. All that equipment was removed and an entirely new system based on three Water-Right, Inc. treatment units (ASC-1, IMTI-1054 (tannins), IMBF (pH) and a McClean unit to remove iron and manganese. In a new heated pumphouse I have a 1000 gallon above ground storage tank that stores treated water and a constant pressure demand pump system. Right now I am hauling city water, so the well pump is turned off and the whole treatment system is in bypass.
This treatment system was installed in July 2006 and operated only a couple weeks until the well went dry. From the beginning the new treatment system did not work very well. It definitely provided clearer water but never clear water. In an effort to extract peak performance from the system, the water treatment company set the system to backwash every night, which consumed hundreds of gallons of water and produced a sudden and enormous demand on the water well in the dryest month of the dryest year.
The treatment company said the water had been difficult to treat effectively because of a combination of precipated iron, or possibly iron having accumulated inside the pipe from the wellhead to the pumphouse a thousand feet away (we created a closed loop on the thousand feet of pipe and ran IronOut thru the loop for three days until it ran clear-- no improvement), or possibly because iron was getting through riding on the tannin. Perhaps as tlbusser suggested, Iron Related Bacteria could be a component, I don't know.
We left that well alone for seven months thru the rainy season and when we turned it on again in March of 2007, the well pumped very clear for about fifteen minutes, then pumped exceptionally red-brown for several hours afterwards. I ran the well at a small trickle for a couple days to see if it would clear and it never did. The water treatment guys took a water sample and said the measured iron was more than ten times what the level had been when the system had been designed a year earlier. I don't have the measurements right now, but he said my iron numbers were ten times greater than what my treatment system could handle. He said the only thing he knew of that might handle that much iron was a tall, sort of flushing ozone tower. He said that system would involve quite a bit of maintenance of removing the muck regularly.
After this discussion I am inclined to hire a second opinion on the existing water well-- because if this water could be treated effectively, that well might get me through most of the year, and if I only had to haul water awhile in the summer, that would be better than I have now.
Also, everyone's suggestion that I get a system of large cisterns for water storage-- that's kind of what my lake is right now. I can learn about the viability of treating the lake water. Someone had asked about our water consumption, we seem to go through about two thousand gallons of water per week and my monthly water bill from the city is about $30. The cost of water delivery is entirely the labor and equipment. Currently I'm hauling my own water with a utility trailer and two tanks plumbed together. We use point of use reverse osmosis systems for drinking water and ice at several locations.