As someone who has puked, and worse, from a GI bug on several continents, but who continues to travel and eat local foods, this is a valid question.
My non-
ABD experience is this: If you can't drink the water, they will make sure you know and hotels (and the tour company) will provide safe bottled water. If the local foods are not safe, they will let you know, and make sure they take you only to places that follow best practices for preparing it. No tour company wants a bus full of sick people. That's not only a PR disaster, but no fun to deal with on the ground either.
And if you have a sensitive GI track, like mine seems to be, I take a peptobismol pill at every meal. Doing some research in the past, that is one of the CDC recommendations to avoid traveler's diarrhea. Since starting that, I've not gotten sick.
We've done street food tours all over SE Asia and Mexico, eating from stalls that I'd never have thought to go in, but the guides were all confident in those kitchens. The same would be for any hotel or restaurant a tour like ABD would take you to.
A couple of our SE guides talked about ice cubes, and how circular ice with holes in it was safe and square ice was not (due to how it's made.) Seemed to be legit since I did not get sick once.
The one place that I've read about that seems to get people regardless of precautions is Egypt.