The simple answer is money. In Japan and other Asian countries, it was customary to compensate your instructor for his time with your loyalty. You cleaned the dojo, ran errands, brought him the finest bottle of sake, etc. Leave it to the Americans to find a way to turn martial arts instruction into a lucrative, capitalistic venture. It just makes more business sense to focus on children, who outside of school have very little time-consuming responsibilities and obligations and can spend more time (money) in your school. Adults have jobs and careers, families to tend to and bills to pay, and if it comes down to another month of classes or food for their children, they're going to hang up their belt (with good reason). That being said, parents will often go without in order to make their children happy and to see them succeed. If you can provide both, while teaching valuable life lessons, cha ching!
What I am saying, and pardon what may now seem like a rant, is that it was unnecessary to water down martial arts training to appeal to the masses. Nothing is more persistent than a passionate child, and they understand far more than we give them credit for. Sure, it's more fun to play games and blast music during a high intensity cardio work out, but martial arts is not solely about fun. Yes, you must enjoy your training or you won't last long, but there is a depth to martial arts study that has been all but lost across the board. Budo, translated as "the path to enlightenment through combat," offers more than punches, kicks and high-fives. Children enjoy being challenged, and doing so intellectually only helps to enhance their capabilities both in and out of the dojo. The argument can made that children should not be exposed to the more dangerous aspects of training, and that's fine. I don't agree with that, but I understand the mindset. It all depends on what your training goals are. If the student is there to learn real-world self defense, there has to be an inherent danger throughout their training or it cannot simulate the real-world experience necessary for them to be efficient under duress (but that's an article for another day).
That being said, who decided children weren't able to understand the mechanics of the physical techniques they are learning, the practical applications of the numerous kata we ask them to memorize and the history of what they're studying? It's one thing to start children (ages 5-9) off with a simplified curriculum to build a strong foundation and then let them grow into a more serious study by the time they reach their pre-teen years. That was all but standard practice in Asian cultures. Even among the esteemed Samurai class of feudal Japan, children were taught the fundamentals of their clan's martial arts with a focus on character development. As they got older, they were then exposed to the science of warfare and by the age of 15 they were some of the most skilled, well-rounded warriors in the history of the world. The problem is that the substance has been stripped entirely in most schools and what should be a youth program has turned into the main focus. This has then trickled down into martial arts losing the prestige of an effective combat discipline and has since been relegated to the shelf of things to out-grow alongside comic books and video games.
The next problem in this de-evolution of Budo is that we are now into the second and third generation of instructors who grew up under this format of instruction and don't know any better. Couple that with the mentality that we instill in all of our students of our absolute authority and knowledge as instructors, and you have the blind leading the blind. Not only are instructors nowadays not teaching the depth of martial arts available to them, they were never exposed to it themselves and probably don't even know it exists (and they won't dare question their instructors if there's something more). Ignorance truly is bliss.
As the generations continue, martial arts becomes a strictly physical activity (sport) and less of a lifestyle. We have the power to stop it. It's our responsibility as instructors to encourage our students to ask questions - not only how to do something, but why. Everything in Budo has a purpose, and a combative one at that, including even the way we bow. It's one thing to memorize countless techniques. It's another to truly understand the underlying principles of what makes the techniques effective and apply them - to internalize what we're learning until it becomes a part of the way we talk, walk and breathe. We owe it to our students to provide the highest quality of martial arts instruction available, and if we don't have the answers they seek, to go out and find them. Put your ego aside, get back on the mat and train before the arts that we love fade away.