I can understand one reason councils may have a problem with granny flats in suburbia. With many "six pack" type blocks of units having replaced single residence homes some councils are probably very close to exceeding the capacity of water reticulation & sewerage treatment & disposal.

Perhaps they have missed the fact that family can move in with parents, creating the same demand on services. This is a much less suitable life style for young families, & the oldies hosting them, than an independent granny flat.