Hello Crab -
When you ask "you can't ignore the anecdotal or blindingly obvious". Its an entirely different thing to ask "which would you prefer" to then extend it to suggest the industry is dominated by low time, ego driven wannabee instructor pilots and a system that doesn't stand up to scrutiny
Also consider the fact that your question can not be taken in isolation of the commercial reality of both training market and the pilot himself who may do the training.
How many ex-mil helicopter pilots will become available to GA training organisations? Most are either looking to gain other type ratings to become commercially enhanced on leaving, privately contracted SAR service, Oil and Gas overseas (loan service may have helped form contacts if you got it) or some other tax free work in the middle east . I'd guess any with a passion for instruction would seek to work at Shawbury first?
How many ex-RAF or soon to be ex SAR captains do you think will be actively seeking to work freelance for £30-40 per hour teaching effects of controls, climbing and descending etc...?? I'll sell that to you at zero.
Maybe the low time FI's have struggled, maybe its for reasons beyond the flying element - how about simply interacting with strange people and the pressure of articulating the course? Isn't there always going to be a beginners nerves element to all of these things? But I don't see this reflected in accident rates and actually you could argue that the very worse sausage factory for helicopter GA is also the most successful - so the customers either haven't noticed or don't seem to care.
The point is you can argue for change but the reasons need to be clearer IMO and what do you change to?