I've taken a ton of lessons, both private and group, at US resorts over the past seven years and thus feel somewhat qualified to answer the OP's question/assertion of "Where instructors go wrong".
I'll start by saying that more often than not I'll enjoy the lesson and get something out of it, or at least feel like I did. And I don't really think the amount of theory is much of an issue. Maybe that's because I'm pretty good at absorbing information and either filing it away for later, or just tuning out it if it sounds like too much detail .
Here's my list of things that instructors could do better:
- Take a critical look at the student's equipment. I skied in boots that were too big and too soft for a few seasons. Not a single instructor mentioned this. My skis also weren't ideal, again never mentioned. And lastly, my poles were too long. Well one intructor did say my poles looked a bit short, so I guess that's something
- Not enough use of video. Out of 30+ lessons I recall exactly one where video was used. Not good enough.
- Lack of race style training. I have no interest in being a racer, but I know the clock doesn't lie. What better way to improve fundamental technique than to take multiple runs through a short race course, it only needs to be a half dozen easy turns, trying to improve ones time? Mixing this with a bunch of coaching and video analysis would cut through a lot of the BS and get to the heart of what needs to be improved with your skiing.
- Excessive possivity. Sometimes I know I'm doing some dumb sh*t with my skiing, but the instructor is still a box of birds. I guess that's better than the instructor getting frustrated, but it can make it hard to get accurate feedback. I wonder if tipping culture is part of it? I've actually had the idea of giving my tip at the start of the lesson so we can dispense with the niceties! I really need to try that next time.
Some of the problems go away if you're able to take several lessons with the same instructor. Once a bit of a relationship forms everything tends to work better.