Way more common than you think. NYC - The Rockettes use canned singing. They cannot sing and dance at the same time and hold proper pitch/tone. Pavarotti has on occasion too, when his voice was not strong enough (recovering from illness). Every float in the Macy's Day Parade - all canned voices and music. It may look like they are singing/playing live - but nope! I think even Disney World does it.
It's done really to maintain the productions integrity and to make sure that the "ticket holder" gets a full show and the sound quality does not go out. It's not to cheat people! You try dancing around and singing at the same time like Britney. I get winded just walking up the stairs!LOL!