I have no idea how long it's been there. It's sort of always been a part of my inventory.
Not wanting to delete a perfectly good bucket of potentially drinkable water, I've left it. It just wouldn't be the same without my Bucket. :)

Does anyone else still have this useless (except to Frag) item taking up space in your inventory, but unable to let go of it?

I did find (according to subetalodge) that it's from when we were to help Mattieu find his missing jewelry materials. [Maybe it was to help wash them off?] O.o' How long ago was THAT?