Part of the problem is that, Shimabuku did issue out high rank to the early american students and didn't expect them to use it and that caused issues with the more traditional okinawan students.
I cannot claim to know why Shimabuku Soke awarded 6th Dan to many of the American students who studied on Okinawa for only a year and then went home to the USA. If I knew nothing of Isshin-Ryu besides that, it would raise my eyebrows as well.
There are many stories about that and what was meant by it, but I do not have first-hand knowledge of any of that, so I won't repeat it here. I will state what I have observed, which is something that an outsider to Isshin-Ryu could not possibly know.
The first-generation students that I know of came back to the USA and continued their studies on their own, in what certainly appears to have been a very diligent manner. There may have been some drift in some cases, and in others, there may be some differences simply based on what they learned when they were with Shimabuku Soke on Okinawa, as he apparently did change his methods several times in minor ways.
What I do know is that the first-generation students I know of practice their kata and it looks the same as those seen in the videos available of Tatsuo Shimabuku. I also know that Shimabuku Soke was brought to the US on various occasions, where he had the opportunity to see various of his students and to apply corrections and fix any problems he found. The fact that these students kept working, and basically 'kept the faith' after such a long time, is nothing short of amazing to me.
And I think that due to the language barrier that things got stated as facts due to their impressions and not necessarily due to outright lies. For example, the early students thinking that Shimabuku was the top student of Miyagi and Kyan. Very few of the early students ever came back to continue their studies with Shimabuku to see what changes/refinements that he had made since they were last with him. I have even seen people try and make money teaching Isshin-Ryu's "lost kata" (gojushiho), which wasn't lost at all, it was dropped by Shimabuku because he didn't like it and was never a part of Isshin-Ryu, which only muddies the waters because it casts doubt on what IR is/was.
I agree. At least one story is told of a first-generation student of Shimabuku Soke who said that he thought that Soke was calling him 'Hey You' for months, because he did not realize it was Soke's attempt to pronounce his last name. I believe a lot was taught by pointing and demonstrating at that time. I do not know this as personal knowledge, just what I have been told.