We did all-inclusive in Punta Cana, DR. We had a great time, the resort was good, food was okay. Beach was beautiful, pool was great. I don't remember having any issues with drinking the water.
This was only our second ever Caribbean resort vacation, so maybe our standards/expectations were not as high as others. But I know other families who have gone to the DR and loved it.
We did not encounter anyone trying to sell stuff, although I heard that was happening further up the beach from where we were.