I belong to a fairly small dojo, so the only one who really teaches formally (which is what it sounds like you are getting at) is the sensei, while the senior-most student will sometimes give some instruction and correction while performing techniques. I think that it is fine for a sensei to have more advanced students teach the more simple things to beginners, otherwise we would be learning the basics over and over, and though reinforcement of the simple basics is good, it would cheat more advanced students if that was all that they did. As long as the student that Sensei asks to teach beginners is comfortable with it, I don't see a reason not to.
As for other students teaching one another, though I know that one is not supposed to do this, I find it very difficult not to tell the person who is nage, and who continually gets confused about how to step, how to do so. What is the etiquette surrounding this? Anyone know?
I know that in a perfect world, the sensei is supposed to come around and correct everything that is going wrong, but if s/he is busy on the other side of the room, is it all right to correct or should one leave their partner to do the technique incorrectly?