is it legal in Washington state for my childs track coaches to limit or restrict water during practices?

It's not a matter of legality (there is no law against it), it's a matter of negligence. I would speak to the track coaches to see if this is true. I am a certified track coach myself and I cannot imagine a track coach telling your daughter she can't drink water during a 2 hour practice. If they are not actual coaches (just volunteers) they don't know what they are talking about. If that's the case, you should talk to the school about it.