Re: Physical contact vs. "no-touch" policy
I was startled to hear "never touch the chest" suggested as a rule with kids. This would rule out Ki Society's usual way of assessing balance (a soft push with the palm to the upper chest) as well as attacks such as kata tori and bear hugs. It seems severely over-cautious to me.
I think that it's important to be careful, but also important not to be so careful that people are afraid of contact--that sends entirely the wrong message.
We have both men and women teaching kids' classes, and I think it is important not to let the current societal over-emphasis on how dangerous men are exclude men from this important role. How can children learn the difference between appropriate and inappropriate when their elders aren't allowed to model "appropriate"? As others have said, we strongly encourage parents to watch classes--there are almost always parents present, except with the teen class--and so we would have immediate feedback if anything the parents couldn't accept was going on.
A much more difficult question for me personally is when it is appropriate to physically restrain or pick up a misbehaving child. Sometimes it seems essential for safety, but it's getting pretty close to physical discipline of a kind that we don't have the parents' consent for. I have one young student who does not respond to verbal demands to sit down and stay put. It is very tempting to pick him up, put him where he belongs, and hold him there briefly. But it is a much scarier form of touch, emphasizing the adult's huge strength and size advantage, than the usual balance tests or pats on the head.