Well I think it has more to do with the fact that they are going to the magical mystical fresh water supply. Farmers seem more likely to go to do laundry, and take breaks. And I noticed that they were healthier than every one else. So I started playing with the water. If you have like a nursing mother who was not at full health when she got pregnant. If you put her into the water 2-4 times her health bar will go up. Now the baby will still be born with a weakened health bar. But, you won't have to track her down and start healing her after she has the baby. Now if the villager isn't pregnant the water helps a little but you need to feed them and drop them in the garden too in order to put their bar back to full levels. Just dunking a regular villager does not seem to restore them to full health. So whatever the reason germs or the fact that they are drinking fresh water with out telling us or washing thier hands, it helps.