I've not read the thread so apologies if I'm simply reposting what another has said.
Kata and Forms and their Bunkai/Applications are training tools that work - although neither of which, on their own, will develop you into a good fighter (competitively or for self defence purposes).
Kata/Set Form: teaches you the essence of the art, the strategy of fighting - e.g. this is how a northern mantis practitioner could respond to attacks x, y and z.
The rehersed bunkai/application/2 person drills practice helps to practice these techniques against an opponent who is resisting moderately - not fully. If someone knows exactly what counter youre going to throw and tenses up the correct muscles in defence then the liklihood is the technique will not work very well. At this stage we are only practising, when we do this 'for real', hopefully your opponent hasnt guessed what youre going to do.
The most important part of this training is a 3rd component that unfortunately, doesn't seem to be trained as frequently as the other two methods: pressure testing, against fully resisting opponents in an unscripted environment - call it sparring, sanda or whatever...the key is that as you progress, the training becomes more 'free form' until we reach the point of basically, what most people refer to as sparring - this doesnt have to be a 'fight' or an enagagement, it can be defend, counter and run away/disengage - the important part is that youre naturally responding to unpredictable aggression.
For me, the absence of the 3rd component is a real issue and it serves to single handedly tarnish the reputation of TMAs. I'm now at a point in my training whereby I'm not prepared to spend X hours training in a style that doesnt offer this, because I'm not getting the benefits associated with forms and application training. This is really annoying, because i communicate with a number of TMA guys in the UK and I watch videos of their training and really like what I see........I want to train a TMA like that, but I dont have much of an opportunity where I am.