I agree with your comments about low time instructors. I visited a school recently and saw one of the local instructors giving a check ride to an overseas pilot who wanted to rent a helo. When they came back the visitor commented that the instructor had no clue when it came to confined area landings. For the record the visitor had over 5000 hrs. The next day that Instructor was off on a flight with a student gaining experience in guess what: confined area landings??.
Maybe there could be some sort of system where you have to go and work in the real world with a commercial operator before being able to pass on experience as an instructor. I know in Australia the head instructors at Blue Tounge, Becker Helicopters etc are all very experienced pilots who have done their time in places like PNG etc.
Maybe its worth a thought.