I purchased a 2 yard piece of OLD (at least 10 years) cotton fabric (black with green 4 leaf clovers) and really coated with glitter. I washed in hot water, I don't think I lost a flake of glitter. I used on a Dino quilt, in 1, 2 and 3 inch strips, it turned out really cute, but not a bit of the glitter has transferred (I washed the finished quilt in HOT, to complete any shrinkage and check for sewing issues). It is now being used by a baby boy, and his Mom and Dad never even noticed the glitter fabric. It was easier on my eyes than the Black with White micro polka-dots I used on a previous Dino quilt!
I would say, wash the fabric in hot, and as long as the glitter doesn't detract from the design, let it ride. If it sheds, wash it multiple times. But I do feel for the gents who object to glittery undies! (Imagine the ER visit, right?) My Dad was traumatized when Mom washed a single panel of her RED velvet curtains with his whites, so I do understand!!!!
On the Environmental issue, maybe if more people request a design to be made without glitter, the manufacturers will start responding, after all, they create for us to buy!