First of all, there are several grey/gray water systems on the market for you to ponder. You don't have to start from scratch or build your own completely unless you WANT to. Remember that gray water does not include toilet waste, which has high concentrations of nitrogen and changes the color and consistency - hence the term "black water", also because it can be so deadly.
There are a ton of websites to study, including
www.greywater.com (nice but small & small system),
www.waterrecycling.com (much larger & larger system) and you can google or yahoo search a zillion others. Wikipedia.com had some interesting links too. Here's a bit from their site:
Greywater comprises 50-80% of residential "waste" water. It may be reused for other purposes, especially landscape irrigation (see
http://greywater.net). The benefits of grey water reuse can include:
Lower fresh water use
Less strain on failing septic tank or treatment plant
Grey water treatment in topsoil is highly effective
Ability to build in areas unsuitable for conventional treatment
Less energy and chemical use
Groundwater recharge
Plant growth
Reclamation of otherwise wasted nutrients
Greywater typically breaks down faster than blackwater and has much less nitrogen and phosphorous -- see
http://www.greywater.com. However, all greywater must be assumed to have some blackwater-type components, including pathogens of various sorts.
Blackwater from the household and other venues can be eliminated via the application of commercially available composting or incinerating toilets in place of the classical flush toilet. Similar devices can be used to dispose of garbage from the kitchen sink disposal.
With appropriate plumbing, greywater can be used for irrigation without pretreatment (it receives high level treatment from soil and plant roots). However, long term research on greywater use on soil has not yet been done and it is possible that there may be negative impacts on soil productivity.
There are numerous "soft" processes based on natural biological principles such as using reedbed filter systems, the wetpark systems or the living wall that can be used to clean up greywater.)
There are also "hard", direct processes, such as distillation (evaporation) which need not necessarily be as energy intensive as they might initially appear. There seem to be as yet no commercially available "hard" greywater recovery devices suitable for on-site use in the individual household, even though a number of such technologies exist, thanks, for example, to the space programs.
Recycled greywater from showers and bathtubs can be used for flushing toilets, which saves great amounts of water. Many attempts at this have been made in Germany. However, untreated greywater cannot be used as flush-water as it will start to smell and discolor the flush toilet fixture if left for a day or more. Although the level of treatment required in this case requires the water to have low or nil BOD, it is not necessary for it to be treated to the same standards as potable water. Greywater recycling for toilet flushing is generally not economical at a residential scale.
In the water damage restoration industry, grey water is considered to be any water from the exterior of the home, or clean water that has been standing for more than 48 hours.
In the U.S. Southwest and the Middle East where available water supplies are limited, especially in view of a rapidly growing population, a strong imperative exists for adoption of alternative water technologies. See the Greywater Policy Center,
http://oasisdesign.net/greywater/law/index.htm
Texas A&M had an extensive research facility several years ago, but my sis says she hasn't had to research it in years because it's become so second nature. I can tell you that she is very satisfied with her system and that it works well. All her drains, including the washer, showers, sinks (no disposal) and dishwasher all go to the system. She's had it in place for 3 years now at this farm, and had one for ten years with great success at her former location. Both of hers were in the ground with no raised boxes or beds and both worked very well.
Good luck and as you learn more, please share with everyone else!
Kathe