Water quality can affect the ingredients used in cleaning products, so it is always best to mix them with soft water. If you apply your cleaners with hard water, it has reduced performance. A general rule of thumb is that if your water hardness is 3 grains/gallon or greater, a water softener will pay for itself. If you are trying to wash touch-less, shoot for 0 hardness.
Water hardness does not affect the ingredients in polishes, sealants, and drying agents. And softening the water that you are applying at that end of the wash process will not reduce spotting. However, the spots left on the car from soft water will not be as difficult to remove as spots from hard water.
Finally a "spot free rinse" system is always a good idea, unless your source water is of exceptional quality.
Answers provided by Magic Wand Car Wash Systems
