ah, that is a good question. I think it's just the "flash and wow!" aspects of it. It is physically impressive to see. But for those of us who know better, we can see that it is hollow flash with little substance. But the masses wish to be entertained, and this is just the thing to do it. Personally, I don't like the idea of martial arts as entertainment for the masses. That's just not what it is to me. It was never meant to be entertainment. Once upon a time, it was meant to be what stood between death and yourself and your family and your village. It was a method of killing, very quickly and very efficiently. It was held as a secret, because you don't want you enemy to know just how much you do or do not know.
But nowadays, it's been degraded to little more than entertainment value. Well, let XMA fill that niche. Those of us who have seen a lot of this kind of showboating don't find it all that impressive anymore anyway. So let the masses have their entertainment, and let them think this is martial arts, but those of us who know better have a valuable secret. Let the masses be mislead, I say.
Now you are catching on. See my rant above.
It does exist, perhaps just not on as large a scale. After all, traditional martial arts aren't such good entertainment for the masses. So these traditional tournaments are often smaller, and local, and don't get much (or any) media attention. Personally, I prefer it that way.
there's the real answer, and nothing else matters.