I would agree if it were a short-term deal - but he's been doing this for quite a while and with a very high degree of success - he pretty much has Denver locked up as far as martial arts schools. You say "to the expense of the customer", but none of what he's selling is a secret - you can come in and watch a class every day if you want. I didn't say I would ever go to his school - but I don't see anything wrong with putting a product out there that obviously has some kind of appeal. The bottom line is - there are no morals in business. As a traditionalist, you should put out a quality product, but if you don't like it, go somewhere else.
Again - I'm not defending the schools as great martial arts schools, I'm just saying the man knows what he's doing as far as business goes. I think it's a crying shame that you can't make a successful career out of a traditional dojo with old fashioned rules, but you can't.
Oh - and to "Teh El Macho", I like sandwiches too - what's your point again?