I completely disagree with the water co being on the hook for anything. They provide water at a price to residences and are responsible for accurate meters and readings, etc. Their job is not to babysit every residence in terms of consumption. They are a publically owned utility, or in some cases a privately owned water company, and as either provide certain services to the public. You, the OP are part of that public. A leak past their meter is NOT their responsibility; it is on YOU, and up the food chain, to the builder and County/State inspectors etc.
Whether your excessive water bill, due to a leak caused by someone on the contractor's payroll is a newsworthy story is debatable. You have recourse under the law and IMHO, that is where your energy should be focussed. Why else have a warranty to begin with? You are paying for the warranty - you should use it to get you what you need. You don't need your wife and child on display in the public eye.
The law is what matters here and it is what will get your builder to do what he should have done originally- install the correct water line, pulled all relevant permits and have whoever was responsible to inspect and sign off on the job do so. This is what contractors/builders do. Their checklist to check off each box as your agent in building your house. Anything less is unacceptable.
I'm not saying you have to follow through on litigation, UNLESS the threat of a lawsuit doesn't bring things around. It is entirely possible that if the builder is concerned about a BBB complaint, that you having your case lined up in case things don't get resolved to your satisfaction will enable you to persuade him to do the right thing without going to court. BUT, if you're not prepared to go the distance, further cob-job workmanship may occur to get you past the time limit on the builder's warranty.
Playing the 'victim' is a bogus approach, and not one I would ever consider. Just because your builder screwed up and you received the bill for his screw-up doesn't make you a victim. It makes you someone who needs to stand up and take names, and force the responsible party, your builder to put the situation right.
You weren't robbed, you have a warranty that you are paying good money for, and now you need to exercise your warranty rights.
Forget the media, they're a waste of time and resources; your and your wife's time.