I'm sorry if this ends up being a lengthy answer. The answer to this question is more historical than anything else but first a little background.
In a waste spark system an ignition coil has two spark plug outputs unlike every other system only having one. Each ignition coil is hooked up to two spark plugs. These spark plugs reside in two opposing cylinders, meaning the pistons move up and down at the same time. This puts one cylinder in the compression stroke and the other in the exhaust stroke at the same time. When the coil fires, both spark plugs spark at the same time, one in the cylinder with fuel and the other in the cylinder with exhaust. The spark in the cylinder with exhaust is called the waste spark.
When waste spark first came out it was on the cutting edge. It was an excellent replacement for a distributor but ultimately it was a compromise. The biggest reason for waste spark is that it required less computational power. Automotive computers were in their infancy at the time and just couldn't crunch the numbers to fire a set of individual coils. This is evident from the fact that at the same time multi point fuel injection systems were all the rage. The injectors were fired all together like one big injector unlike sequential fuel injection that followed that fired the injectors individually in the firing order. This is further evident from the use of ignition modules like in GM vehicles and EDIS in Ford vehicles. These modules performed some of the needed calculations to relieve the PCM from having to do them.
The wear and tear on the spark plugs you mention is over exaggerated because the waste plug always fires in the exhaust stream which is full of hot ionized gas that is really easy to fire through. In reality the spark plug that is firing backwards (side electrode to center electrode) incurres the most wear.
Most automotive manufacturers did eventually go to individual coils per cylinder, this is called coil on plug or coil near plug. It's a more advantageous system because dwell and timing can be controlled per individual cylinder. Even with the fact that they are so modern these systems still retain some the the roots of where they came from. For example in a Ford V8 engine with coil on plug, if the camshaft position sensor stops working the engine will use only the crankshaft position sensor and regress to using waste spark and firing the injectors in banks instead of sequentially. This is a drive me to a garage limp mode. Also some manufacturers still retain waste spark even on engine manufactured today. Take the GM Ecotec 4 cylinder engine for example, it still uses waste spark.
Finally your two cylinder question. It really depends on the design of the engine. if the cylinders are opposing like Vtwin engine then yes they use waste spark, but also these engines normally use a magneto system which always fires the same spark plug in the exhaust, it can't help it. If it's a flat engine like in some motorcycles then it does not use that system because the stroke of the cylinders is opposite.
P.S. odd number cylinder engines (greater than one that is) are so rare that it would be more of an exception that a rule as to what ignition systems they used.
