Distilled water can be used with no issues, especially when added to salt mixes. Distillation removes the minerals from the water as well as many of the volatile organic substances. Using it to make up your salt mix will replenish the lost minerals needed for the tank water.
Distilled water is a much more intensive process in terms of energy use as the water must be boiled and condensed. Reverse osmosis and Deionization (RODI) is a much cheaper process and does not involve a lot of equipment.
BeakerBob - Past MMMC Club President, current Board Member