Those instructors still exist (okay, maybe not the ones who flew Spitfires in combat). They're in the minority, but they exist.
What they rarely are nowadays is full time instructors.
There are out there people who have done a lot of very interesting aviation, and instruct - I can think within my acquaintance of a couple of test pilots, a former airline pilot with 15k+ hours, somebody working outside aviation but who has thousands of hours that include meat bombing and private warbird flying, a couple of people who have competed internationally in aerobatics or in microlight competitions.
They're there - not usually working full time teaching new PPL students, but they're there.
G