If you're growing in soil, especially living soil (which soil should be), or even plain potting mix you DO NOT want to wait until the pots are completely bone dry. If the plants are beginning to wilt, you waited too long. However, I know some actually think the wilting is acceptable as if the plant likes to be deprived of water, not really the case. Potting mix (which is generally sphagnum or coir-based) tends to possess hydrophobic properties when it is really dry, and will actually repel water. You will see it pool up on top and run down the sides, without really being absorbed. In these cases you have to start watering very slowly, or from the bottom to ensure thorough absorption. Underwatering isn't good for the microbes living in the mix and it certainly isn't good for the plant.
"Overwatering" is actually the result of low oxygen in the rhizosphere. Plant roots breath oxygen! Water itself can only keep small quantities of dissolved oxygen (O2). A high quality potting soil\mix has to have have good porosity as well as absorptive properties. It holds both water and air, while excess water drains away. This is hindered if the potting soil is too heavy, and compact. In this case the dissolved O2 can become depleted very quickly, as it is used by both the plant roots and the aerobic organisms, so anaerobic conditions result and this environment is no good for plants. You don't want to keep containers sitting in stagnant water for the same reason.
However, with a high quality well draining mix, overwatering really shouldn't happen so easily; it can't happen in one or two waterings. I think a lot of people are afraid to water properly because they are afraid to "overwater" and this just leads to more issues. The way you water potting soil is, you water thoroughly when you water. Water as much as it takes until you get run off. Then you wait until the soil has dried out substantially, but not completely, the containers will have lightened up. Then you water thoroughly again. If you wait until it is too dry you wont get thorough absorption; you'll have to water slowly with a small volume of plain water, wait about 20 minutes and then water thoroughly or fertigate.