In my experience very few karate instructors understand kata and some of the utter nonsense that is taught becasue of this lack of understanding is laughable. Associations write the syllabus, not individual clubs or instructors, so they teach kata even though they don't properly understand it.
I do not have the direct experience you do, but I believe you are correct.
This is why, despite begin rubbished as long a go as 1938 by Mabuni (and in spite of common sense) many karate instructors today still teach "the turns in kata are you turning to face a new opponent". That is what they were taught by their instructors, and that is what they teach, and then their students become instructors and perpetuate the same nonsense to their students.
I do not necessarily think it is wrong to teach that the directional turns in kata are to face a new opponent (begin a new sequence of defense and attack), but it's just the beginning. I have found it difficult to absorb very technical explanations when I am just beginning to learn; a simple basic explanation will suffice whilst I start to peel the onion of that particular kata. Turns are so much more than just an imaginary facing of a new opponent, but you have to get to the point where you can see that first somehow.
Yes they will find an alternate use for it, but that is like buying a Ferrari and then use it as a plant pot. You have this awesome highly useful and sophisticated piece of machinery, and you use it to grow Fuchsia's simply because you haven't learnt to drive.
If you have kata, use it for what it is designed for, don't use it for something else. If your goal is something else, then come up with another way of training specially deigned to address that goal.
This particular problem, in my limited understanding, is that far too many instructors began teaching well before they had advanced beyond a basic and rudimentary understanding of kata themselves, so they had little to pass on.
It is not so much that what they teach about kata is wrong; it is that it is incomplete, because they have breadth but not depth. Everyone is in a hurry to get teaching and become a 'sensei' or 'master' and start earning a living or passing on what they think they know.
I assist in teaching. By that I mean I show basics of the first few kata to kids, under the supervision of my sensei. I work on feet position, hands, turns, balance and breathing with them. I do not teach them that a kamei can be used as an armbar tie-up, for example. It's just a kamei for now. And I also have much to learn, so even though I know more than the beginners, I still don't know much.