The song is about California doctors and lawyers and business executives, living in their modest million-dollar houses. They have no life. They work long hours, commute long hours, and then go home and sleep. They don't know their neighbors. Their chief social contacts are their "personal trainers," with whom they spend several hours a week "working out."
I had to do government security clearances on these people, and had to go through the motions of going to the neighbors and knocking on doors to find people who knew them. More often than not, none of the neighbors knew each other, even when they had lived there for years.
Now, obviously the song is a caricature, as is the opening sequence from Weeds. Yes, there are many neighborhoods in California when neighbors know each other and interact and work to better their communities - there are even neighborhoods where people gather to sing folk songs. But there are California neighborhoods, particularly neighborhoods of high-income people, where the inhabitants fit Malvina's caricature very closely.
I think that the song "Little Boxes" actually helped to change California urban planning for the better, and much of the sameness of California housing tracts has disappeared. But there still is a need for more variety. Thousand-house tracts are still built in California with a selection of only five floor plans. The first house I rented in California was a three-bedroom house in Fresno, with the kitchen in the middle front, between the garage and the living room, a family room behind the garage, and three bedrooms and two baths behind the living room and kitchen/dining area. The first house I bought in California had the same floor plan, but it was a bit smaller. My second house was two-story home in Sacramento and quite different, but there were houses across the street that had the same floor plan as the two houses we had 200 miles away in Fresno. And after we got divorced, my ex bought a house in Sacramento with the exact same floor plan as our two Fresno houses - my son lives there now, and it's like "deja vu all over again."
In certain places in the US, urban planners have made a move to do away with "snout houses" - houses where the garage door is in front of the rest of the house, creating a neighborhood where all you see is garage doors.
So, I think that "Little Boxes" is a valid and valuable commentary on American urban planning. Certainly, it exaggerates to a point, but can't exaggeration be a valid tool for songwriters and storytellers?