A quick story that goes back to the initial statement in this thread.
Several years ago I was instructing for a mid-sized training organisation that carried out ab-initio training to frozen ATPL standard. We used Cessna's, in many variations, but mainly 172s and 150/152s. There were two new instructors, both ex-students of the training program that had been streamed into a FI course straight after finishing the main course. As they had done the FI course on 172s, after completing this and with a still-wet FI annotation on their shiny new licences, they needed a 150/152 checkout and I was asked to do this.
It was deemed to be a bit of a formality as they had both trained on the two-seaters, but it had been a while and they had flown several other types since. One brand-new FI sorted out, I got into the aeroplane with the second one. We left the circuit for some airwork and then returned to the circuit as I wanted to see several landings in different configurations. This second FI then proceeded to surprise me, as he was unable to produce a decent cross-wind landing! He kept putting the mainwheels on the tarmac in a crabbed state, burning lots of rubber every time. I kept insisting on a wing-down touchdown, may even have demonstrated bits of it during the approach, but no joy.
After the flight I took this up with our chief FI and we ended up letting this FI loose with a 'max 5kt x-wind' limitation. This was very much an internal limitation, said FI had all the paperwork to say that he was qualified to operate SEP types up to the stated limits. And as it was a bit of an internal issue anyway, I am not sure if said limitation was ever applied.
In the end (and as I had expected) experience and confidence grew and this became a useful instructor who later went on to fly larger types. I don't think the internal limitation was ever followed up on. It was not written down anywhere (I guess) so it probably just disappeared by itself.
This FI, and many others (including myself I guess), learned their trade at the expense of their students in a way. It is true that you don't really learn about flying until you start teaching it, but I certainly think that the overall standards are changing. We should of course also argue whether we still need to apply the same standards these days... but that may be a different discussion.