I have a Cape Cod style wood-sided house built in 1948. When we bought it in 1985, it was peeling very badly. Since the sellers were elderly, we thought it was just neglect.
So we had it professionally scraped, primed and painted with 20yr latex. Within 3 years, it was badly bubbled. It has subsequently peeled to bare wood in places.
My dad claimed that this was from moisture coming through the walls. However, that the peeling was completely uniform over the entire surface area of the house despite that: 1) We had re-done the upper story, putting in a double vapor barrier. Yet there was no difference between the upper story and the lower story, which doesn't even have insulation. 2) Neither the bathroom or a corner room with aquariums showed any more or less peeling. 3) The ventilated area above the upper floor peels as badly as anywhere else.
I can't stand the thought of vinyl siding. My wife wants to get it repainted NOW (I've stalled for a good 5 years), but no-one will guarantee their work from peeling, and without a guarantee I think it's just going to be throwing money away.
I wouldn't mind having it stripped and stained (although it wouldn't be very original-looking) just because stain doesn't peel, but no-one wants to do that either.