The answer is 'it depends'. I made a felted hat with my first handspun, and it took 3 trips through washer and dryer to get it small enough to fit -- the last time it hardly shrunk at all, so likely it now qualifies as 'machine washable'. My mother's felted clogs, however, only went through 1.5 wash loads and 1 dryer load, so I'd be a bit leery of throwing them in the washer again. I don't know if there's some standard way to tell if it's as felted as it's going to get, other than felting a small sample until it won't shrink any more.
(posted by me on spindlers, 12/10/2001)