I think that, as Grenadier says, tradition is important, because it is proof that a system works, that the kinks have been worked out of the system.
There is another purpose to tradition: it creates an atmosphere. I have been in classes that are less traditional, and they are good classes - but for myself, the atmosphere provided by the more traditional, formal instruction (uniforms, formal address, straight lines, etc.) help me to attain a mindset that sets my training time apart from the rest of my day - and I need that. It works for me, and helps me with my training. Not everyone does - and for those people, a less traditional setting may work better.
As far as the general question, of whether tradition is good or bad - I don't think it's either. Tradition just is - and in some settings, and for some people, it is appropriate and/or useful - in other settings, and for other people, it is inappropriate and/or not useful. It is up to the individual whether or not tradition is good or bad for the person.