The position of seiza as we know it was formalized during the Edo period, as part of a large number of edicts and customs imposed on the warrior class to prevent a violent outbreak. Another Edo period concept we attribute to the Samurai is the idea of Bushido, a code of ethics similar to European chivalry that supposedly holds warriors to a higher moral standard. In truth, Bushido was introduced as a concept to keep bored Samurai in line. Without wars to fight, professional warriors being paid to sit around can get fairly rowdy. Rape, pillage and murder were just par for the course during times of war when the army was stationed in a faraway land, but they become rather unfortunate side effects of boredom when you have drunk, testosterone-filled warriors accustomed to living on a higher rung on the social ladder and getting away with, well, murder. But I digress...
Seiza was introduced as the proper way of sitting for Samurai during the Edo period by the Shogun simply to make it harder for a visitor to quickly attack the host when conducting a meeting or ritual. Anyone who has sat in seiza long enough knows the feeling of numb legs and locked knees. When milliseconds matter, slowing down your would-be assailant by forcing him to attack from a position of discomfort can quite literally be the difference between life and death. So prior to the Edo period, when Japan was in constant conflict, what was the "correct" way of sitting for formal occasions?
1. Anza - crossed leg
2. Tatehiza - kneeling with one leg up
The picture at left shows Toyotomi Hideyoshi, sitting in anza (also called agura). While still not ideal for attacking or defending, a warrior of his stature would have retainers and bodyguards available to dispose of an immediate threat and buy him the second or two needed to respond.
The next position, tatehiza, is the most tactical way of sitting. One leg is tucked under you, while the other knee is raised and prepared to stand. Ironically (or not so), compare tatehiza with the way modern BJJ students are taught to sit in preparation for a technical stand up.
Before I continue, one thing that drives me nuts is seeing seated kata with katana. If you are seated, you are generally indoors. When entering any building, Samurai would leave their katana at the door. This is the exact reason they would carry a wakizashi or tanto, so as to not be unarmed. I do know that the Omori Ryu were notorious for practicing seated kata with katana, that many of the modern iaido kata are derived from Omori Ryu and that even some other koryu have adopted the practice in modern times. However, there is simply no historical basis for it.
Now, fighting from seiza is not any less difficult empty-handed as it is with a blade. Many jujutsu kata exist where a seated opponent is attacked and disposed of. One ryuha where these roles are reversed is the Daito Ryu. To my knowledge, Daito Ryu is the only koryu with an extensive handachi curriculum that involved the seated practitioner "winning" the engagement. Why is that?
Given that context, along with further development during the Edo period, it would not be uncommon for such guards to find themselves in seiza while in the presence of the daimyo. Should the lord come under attack, they would be the first line of defense and need a series of techniques designed to deal with the attacker quickly and without footwork or large movements.
That's really where the idea of "internal" martial arts comes from in the first place. It has nothing to do with chi or any mystical force. It's simply movement that generates great power yet is so subtle and imperceptible except to the most trained eyes that it seems like it origins from "inside" the body. The Aiki arts use this type of power to off-balance or completely throw their opponent, while its Chinese counterparts (Taijiquan, Baguazhang and Xingyiquan) often use it for devastating striking.
In modern times, training from seiza and learning to shikko (knee-walk) has several benefits. Shikko itself is a great way to strengthen the muslces around one's hips/waist to help achieve a lower center of gravity and to aid in stabilizing one's upper body when executing various techniques.