cloudy water

It's dissolved air which has come out of solution. It's caused by sudden pressure drop and/or temperature rise. With slow flow and high temperature, both these effects are maximised.

It is air in the water. It comes down the pipe that way.

On an old style vented cylinder, the water settles in the cylinder and the air is vented off the top. This effect does not happen with an unvented system, like a combi or heatbank, so the air makes it all the way out of the tap. The sudden pressure change as it leaves the taps makes it form bubbles, as the water can hold less air when heated (which is why the cold doesn't form bubbles). When running at a high flow rate, the outlet temperature drops and the pressure change is less, so fewer bubbles form.

Christian.