One of the main problems is not so much that forms are taught and practiced, it is when they are taught as the main course of a Kung Fu program. Basics should be taught above all, the four elements of chinese martial arts. Da (Punches, elbows, upper body striking) Ti (Kicks, knees, lower body striking Shuai (Throws, clinch technique) Na (Seizing, trappling, submissions).
Also, blocking, parrying, trapping, and sticky hand technique should be taught, along with bag work, mitt work, two person drills, and most importantly freestyle sparring and grappling.
You Know Who said it best on here once, teach your students how to fight first. Then, they have their whole lives to learn and do forms.
"The hero and the coward both feel the same thing, but the hero projects his fear onto his opponent while the coward runs. 'Fear'. It's the same thing, but it's what you do with it that matters". -Cus D'Amato