I think part of the problem of perception is that for a lot of people and a lot of schools, the focus really is on the sport aspect. TKD has a strong sport aspect to it in that you can participate in organized tournaments and such and train the rules for the sport and not even really look at it as combat. That's ok for some people, that's what some schools teach and what some people want to do. However, people don't sit around arguing whether football or baseball is the best sport for self-defense and I don't think 'olympic-style sparring' or 'point-sparring' as some schools teach as a sport is really meant as self-defense training either. A friend of mine says the whole point of coming to class is to spar and while I don't have the same viewpoint, if that's what he's in it for then I really don't fault him for that
That being said, I think using any sort of ring-style sparring match as a true gauge of the self-defense aspects of a MA, even for those who practice the MA for self-defense/combat, is a bit misleading. Take someone with strong ground-grappling and joint manipulation skills and put them in an TKD match and you'd see a different result as grabs and holds are not allowed. They may be a very good grappler and even an adequate striker but in a context where striking is favored by the rules against someone who heavily focuses on striking and it's a different ballgame. What does that say about the grapplers self-defense skills? Nothing, really. It's just the rules of the game. Last week I was playing jazz at a club and the TV was playing something with some female kickboxers and I thought their kicking was terrible; poor technique and no power (by TKD standards). In a TKD match, they would get killed..but they were also very good at standing in and using punches and taking hits and especially avoiding punches. What does that say about TKD versus kick-boxing? Nothing...different rules encourage different tactics lead to different strengths and training styles.
'Cause after all, it's just a game. Any sort of tournament is an artificial situation. I think one of the fisrt aspects of self-defense is having the situational awareness to try to avoid being in danger in the first place. If something comes up you can't avoid, then a little pain may diffuse the situation. Something to allow the aggressor a chance to back down. Again, situations vary; a drunk at a superbowl party mad at you for wearing the wrong team jersey is not the same as a guy pulling a knife on you for your wallet in the parking lot afterwards. Different situation, different aggressor mentality, different ways to get the aggressor to back down before it gets to all-out combat. In a MMA style tournament, your opponent is trying to win and is not going to back down. However, in a live situation where you do run into an aggressor where you cannot minimalize the situation and they are really trying to hurt or kill you, then all bets are off, and all rules are out. Which means no messing around with points or legal strikes, and if you're training is in a striking art, especially TKD, then that's going to include breaking bones, strikes to the throat,etc... In other words, I think there are techniques available in striking arts that would be useful in a life-threatening situation that are not allowed under any rules, so judging the effectiveness of an art for combat based on performance in a context where some of the art is not available is not really realistic.
In the end, it's really all up to a) what do you want to do and b) what do you train for. If you train for sport and the sport aspect is what's important to you, then that's good. If you train for combat/self-defense, most systems were designed for that anyway and as long as you train in the full range of your art then that's good. I think we nned to be careful, though, not to judge the combat effectiveness of a particular MA based on it's sport expression