I was lucky - I flew with the same CFI up to CPL and never paid directly for ground schooling - it was there though and like Whirly I did the PPL in a short course and had done all the study to pass the written beforehand. However lessons were discussed before and afterwards.
But I did spend alot time with the CFI and other instructors from the school socially and learnt LOADS over the booze! So I guess I did to an extent pay for the time in the pub with my rounds!
In the US it isn't compulsory as such but you need a sign off or evidence of study before being allowed to sit the written exams... I know it can be fiddled but at the end of the day if you don't know the subject you won't pass the exams....
PW