Its been a while since I was lead certified, but I dont remember having to collect wastewaster.
I guess if the house is THAT bad, it might be a good idea to do a round of scraping before a powerwash. I RARELY did houses in that shape though. And when I did, we would just sweep it up real good when it dried, and maybe take a rake to a lawn. One time, my boss had to shop vac a ladies backyard cuz the the paint was flaking so bad on a wood awning or something when I powerwashed. In hindsight, I probly should have scraped that part first. Lead is a WHOLE other ballgame, and I wont even go into that. If a house is that bad and has lead, if I DIDNT run from the job, I would tell the client that since Im not a lead remediator, all I would be willing to do is paint right over the lead with no prep.I use the OPs method (scrape/sand, then wash) due to the massive number of chips that go flying when you pressure wash a house like that before scraping. How do all you wash-it-first types contain chips, especially on lead jobs?