As someone who worked for Severn Trent in a management position for 11 years, I think I have an insight on this issue...
Firstly, desalination. Forget it. The cost is appalling, the environmental cost is very high (the energy use is massive, Saudi only do it because they have cheap oil and it's basically their only option) and the water is not FULLY desalinated so to us it would taste disgusting. If you're not sure what the definition of 'fully desalinated' means, hark back to the time at school when you had a to dilute a solution to a tenth, then dilute that to a tenth, then again, and you could still taste the salt or urea compound. So in other words, getting that last few parts per million of salt out of the water is ridiculously expensive, so it's impractical to do so in a way that leaves the water tasting anything like what you're used to.
Secondly, tankers - by road or rail. Water is very unsuitable for bulk transportation in this way, it's very heavy and the cost per cubic metre just isn't worth the hassle - particularly given that if the water is treated (ie meant for drinking) you have to take special hygiene precautions for the tanker and the mechanism you use to transfer water to/from the tank. Water companies DO use road tankers from time to time, when there's no option, but as a general distribution system it's a non-starter.
Thirdly, leakage. Water mains leak, that's a fact. Water companies would prefer them not to, but they do. The UK has, with no exaggeration, hundreds of thousands of miles of pipe laid in the ground (some of it laid a long time ago). That ground moves through subsidence, the ground freezes or dries out depending on the weather, the stuff INSIDE the pipe starts to freeze and therefore expand in a cold snap, and unlike your average industrial oil pipeline that's kept flowing at an even rate the flow can be anything from virtually nothing at 3.30 am to full-pelt at 6.00 pm, further stressing the system. And given that you can't see the pipes underground, it's not a surprise that leaks happen.
Now, if water was the same price as bottled poncy mineral stuff, you'd say that if you're losing 10% then it's cost-effective to pay lots of people to get in the wagon with picks and shovels and find the leaks and fix them. But in fact mains water is dead cheap - so what is better value, spend money on more repair gangs or shove in slightly more water knowing that you're going to lose a bit on the way? There's no 'right' answer to that one, it's a balanec to enable the lowest water bills and having hundreds of gangs going out chasing every single leak is not the most cost-effective way of doing it.
Fourthly, using water from tube tunnels. Forget it. It's contaminated, it's not in the right place, it's hard to extract centrally and distribute. Not all water is suitable for treating, and tunnel flows fall right into that category.
Lastly, harking back to the first point on salty water, you have to remember that unlike electricity, 'water' is not simply 'water'. There's hard water, soft water, water with different characteristics of dissolved minerals or dissolved oxygen. When I worked at Severn Trent, there was (I'm sure there still is) a pipeline connecting the system at Coventry down towards Strensham (site of the services on the M5). The flow was normally in one direction, south from Coventry, but when necessary that flow could be reversed to help out if Cov was a bit short. When that happened, we were always inundated from residents of Coventry complaining that their water 'tasted funny' or was 'off'. Water quality is a funny thing, you would want and expect all the usual standards to apply such as not having bugs in the water, but so much is subjective about taste, odour and even colour (yes, in Stoke on Trent they are used to having water that's a different 'tint' to Gloucester!).
So on this topic it's easy to be a Clarkson-esque "How hard can it be" armchair critic but to be honest if the answers were easy they'd have been done by now.
Paul
PS I'm not an apologist for the industry, I left in 2002, but I knew a lot of colleagues who worked very hard and wanted to do the right thing by the community. Saying that 'all water workers are lazy and stupid' (not on this thread, but elsewhere on the internet) is just as wrong as saying 'all rail staff are lazy and stupid'.