Personally Teenage I love 'the reek of excessive fabric softener' - I can't get enough into the machine! I've never found it to fade clothes though.
Jesus Christ, I'd die of shock (and happiness) if my XH/the kids Step'mother' had washed their clothes - I'd put out the bunting for that one. How nice of them to do that is my view. Surely ONE wash wouldn't render all their clothes buggered for ever more?
What you'll find re the 'must be dry cleaned' label is that it's right in some cases and not in others.
Unless you're really going up in brand levels the clothes are all made in the same way - typical fabrics like viscose, overlocked seams - it's the same at Next, at Whistles, at Primark with different quality levels at each but essentially the self same manufactured in China mass-sewn products - just the design, branding and marking is more up market with some, but the product is essentially the same.
Some of the dry clean only is perfectly ok to wash in the machine as long as the temp is low, you don't agitate it a lot and you obviously don't tumble dry it. I take my stuff straight out the machine the second it's done, iron it (it's pretty dry by then anyway) the dry on the old clothes horse so no strong heat used). Retailers put dry clean only because it covers them if you do chuck it in the washing machine on a vigorous hot wash and then it shrinks - they cannot possibly test every single garment/fabric to determine if it would wash ok in a machine or hand washed so they apply that label to many more items than need it just to cover themselves.
Some of the bobbling you mention can be due to the garments rubbing together when washing so try and find some laundry mesh bags so you can separate out each item into it's own bag - I often do that especially with jumpers and I've not had a lot of bobbling even with Primark jumpers.
I think you're probably right, the quality is going down. Next in the early 90s used to be different and a bit better quality but it's essentially not a lot different to Primark - just more expensive. Quality would not only be shown in better sewing/finishing but the fabrics used so if you're still in the 'viscose zone' the extra money you're paying for is mostly design and brand-related, not quality of garment (iyswim). I don't know what brands you're buying but I suppose the higher you go up that ladder the more the materials would be natural ones such as cotton, wool, silk - and then you would undoubtedly be in hand washing in the sink only / genuine dry clean only.
I think (and it's only my opinion) that you can get better design, better patterns etc with the higher priced clothes you describe but also that sticking to key items from those retailers and make some of the dresses, blouses, skirts, trousers from other retailers (when they are essentially the same) is probably the way to go. You buy a 100% wool/alpaca overcoat that costs £200 but you have it for life and it has to be dry cleaned. The other garments can be surprisingly well styled from less expensive shops and it's how you put them all together that probably makes the most difference.
Maybe it's time to review the brands you're buying I don't know. But anyhoo, good luck with your ongoing laundry endeavours and may the bobbles not be with you!