What/why is it/do they spray after fueling the car? I've just assumed it was to dilute any fuel spillage and that is was water? Just wondering....?

I'm pretty sure you answered your own question.

I'd like to know for sure...been asked numerous times and like to be able to answer definitively.

you are correct

Thanks! I assume the spillage has found its way to an ignition source before or are they just being proactive?

There have been fires before, so I would say proactive with that caveat. I suspect for vapors moreso than liquid.

I noticed on overhead pit shots that the exhaust appears to be behind the fuel fill point so I can certainly see potential. Amazed it doesn't happen regularly so the spray must be pretty effective.

It probably some antiquated tradition.

You know, like having Carburation Day for cars that haven't had carburetors since FDR had functioning legs