That lineage and tradition is prevalent in all styles of Karate and it hinders its growth and progressiveness. Making it far less effective and beneficial than a fully alive martial art, when it could be if people left the archaic methods behind.
Have you ever studied a fully alive martial art? (one without compliant partner drills, full contact sparring and no kata)
Im not sure I'd consider any of modern martial arts in the world right now dead. Also, I'm not sure what your background is, but even in Boxing and Muay Thay theres a degree of control. People aren't as bloodthirsty with their sparring during the week as they are in a bout. On the flipside, most Semi Contact TMA schools dont spar as lightly as people think. Bruising, blood, and damaged bodies are more common with the adults than outsiders think. I've been rocked and dropped just as much in my Moo Duk Kwan classes as I was in my Boxing days.
Every art, style or system has a degree of compliant partner drills. Your first day of Sparring in a Muay Thai gym, your trainer isn't going to let your partner clobber you. Nor should your partner come out and crush you. Early on, compliance from your partner is there so you can learn and get comfortable with techniques. More comfortable you are, the more resistance you should get.
One of the best benefits of Kata in my opinion is the teaching of proper technique, torque, and (depending on your instructor and how he teaches moves) applications. For example, Anderson Silva has an amazing TKD Front kick. He comes from TKD, and itd be ignorant to assume his Hyung never helped his kick at all.
Kata also arent meant to be practiced without One-Step Sparring and SD. You should be practicing Kata, then be taking some of the applications and drilling them with a partner. With kata, you can still practice alone. Also, you have the benefit of having many, many more movements taught at once with which you can draw your own techniques and combinations from. Whereas, in systems without kata its exceedingly difficult to practice your SD techs on your own and you are limited by what your instructor knows or what you learn elsewhere as opposed to adapting a movement in from a choice of 50 moves in the most advantageous way for you.