it happens in all the age groups, as young as anything. The notion of free substitution is unique to the United States. So is the one team per club mentality. I don't know how much they scout... but I am certain (for tournaments at least) that larger rosters are allowed.
To me, it makes sence because if you only bring a small number of players, then you let them play more. I have a buddy infact, who was raised in England, and his school had 5 soccer teams. Eleven on each team, with no substitutions. The Coach of Team 1 picked the best 11, The coach of team two picked the next 11, and so on. IN the end, 55 kids got to play, so there are some positives to this system. (if someone got injured... they had to play with ten!)
I can not, however, be certain how things are done everywhere. Even in one country, things can be done differently for different levels.
The substitution rule, however, I am confident is common throughout the world.
Interestingly enough, many youth teams abroad are sponsored (even the youth teams where advertisments on their jersey's) and the kids play for free. As such, parents get no say in their kids PT.