I agree with all of what you said, but want to add to your last statement and why that becomes difficult. You should be able to run a business without deceiving your students, and making false claims about what you provide. But when you have three other schools in the area, all making the false claims, to the incoming student your school may fall short. I haven't run a school, and wouldn't lie about what we could provide, so I don't know that it actually would. But I can see how a prospective student, hearing one place can give them everything they want with no effort, while another place requires a lot of effort and can't give them everything, would go to the first place.I can't imagine why you would want to avoid such an important question, unless you just want to sign-up students, regardless.
For example, a number of years ago I had a middle aged man sign up for lessons with his petite 12 year-old daughter. He told me that his concern was that he shared custody of his daughter with his ex and her new boyfriend. According to him, the ex was an addict and the new boyfriend was a drug dealing thug who was dangerously abusive to his daughter. Worse, when the ex and boyfriend had custody, they stayed in a trailer in a remote desert area with no neighbors close by. He wanted to know if the martial art I was teaching would enable his little girl to protect herself.
I did not "customize" my answer. It was a simple "no".
Basically I told him what a I stated above. That even for physically capable adults, self-defense is about awareness, avoidance, de-escalation, and/or escape. Having to defend yourself physically is your last and worst choice. And for a little girl stuck out in the middle of nowhere, trying to physically defend herself against a thuggish step dad was no choice!
Now admittedly, that is an extreme case, but I run into similar, but less extreme cases all the time. How about the case of my step-brother's little kid who was given his TKD 2nd degree black belt at age 12, and told me that because of his training he could defend himself with his empty hands against a knife attack ...even from an adult.
I grabbed a plastic spatula off the kitchen counter and harmlessly educated him as to the error of his thinking.
Anyway, I digress. I've been doing TMA for a long time and I believe it has a lot to offer many people. But I'm fed up with exaggerations and false claims ....usually justified by folks saying "I'm just trying to run a business". Maybe I'm naive, since I'm not teaching to make a living, but I think you should be able to "run a business" without deceiving your students.
The upside of that is (I would imagine) that the honest school gets people more likely to stick around, and more experienced new customers, since they know the other school is bsing them. And I still don't condone the lying for the purpose of "just trying to run a business" (or any purpose I can think of), as you're just contributing to the problem at that point.