Make boxing gloves and headgear standard issue. Use these to work two-man cooperative boxing drills.... bridging right to striking, or whatever your style's specialty is. If these drills are not first nature to you, you should not be teaching.
Increase intensity of drills.
Remove headgear.
Remove gloves.
Put gear back on and fight (not spar) but with super fast stoppage by supervisor. Supervisor needs to be able to read what's happening at point of engagement.
After 18 months of this training, everyone will become more more comfortable with the situation. Everyone will understand the dangers of certain positions, scenarios. They will respect them.
Now people can pair up to light spar. If egos make it too competitive now there is a forum: fighting.
Not saying this is how it has to be, but it has to be sort of like this. Don't show it to them in a form. Show them the principle and how it works and make them work it.
This type of training will take care of the other big problem with Kung Fu... talking $hit. There's never so much talking during what should be training as in Kwoons. Stories about the good old days. Stories of how this style is superior to that style AND WHY
Lots of talk.
If you train this way you'd be embarrassed by the talk. Because you now know what fighting is: a combination of technical skill, physical ability and will. Talk plays no roll. Shut up and train.