George S. Ledyard
I think that people generally misunderstand what is going on in this type of practice. So many folks in Aikido have an empty hand mentality, and one that isn't based on very deep empty hand skill at that.
This stuff came from weapons training originally. Once one is past the basics in sword for instance, it's really all about connection. If you attack when the opponent isn't open, you are dead. It's not a matter of being tough enough to take a punch, or being grounded enough to resist a throw... it's an inch and a half deep touch to the heart, a slice to the throat, a quick cut that lops off a hand...
Since very few folks train with anyone who is capable of single blow fight finishing strikes, the need for this type of sensitivity isn't there. The ability to take a hit becomes important. You can trade blows as long as you protect the most vulnerable targets. You can stop a technique because the opponent will only hit you rather than cut or stab you with a blade.
I think what you are seeing in this type of practice is sensitivity work for it's own sake. The nage is "communicating" with his partner, letting him know that the space is already taken, the uke takes ukemi as he feels the openings shift and close. Whereas this type of sensitivity has a central place in certain types of martial application, especially deadly force encounters, this type of practice is no more "applied" than normal Aikido Kihon Waza is "applied".
From the standpoint of why one would train that way... well, it much depends on why one is training in the first place. As is evident from many of the posts one sees here, there is a lot of focus in many people's practice on self defense and fighting. Most people's understanding of what they are doing is thoroughly physical / mechanical. If, however, one does a lot of sword work, this level of connectivity makes perfect sense.
If one trains with the Systema folks, they work to develop this type of sensitivity as well and their training methodology isn't all that different from what Abe Sensei is doing... However, since the focus of Systema can be a bit more practically oriented than Aikido, they take it one step further. They also train in not giving away any energetic signals that the opponent can read. They practice striking with no intention, making it extremely difficult to feel it coming. Ushiro Sensei also talks about the same thing...
Anyway, to my way of thinking, Aikido folks need to do a lot of work learning how to communicate on this level before we are ready to talk about how to be deceptive with ones communications. That's why this stuff looks so exaggerated... in a sense, it is. Abe is really blasting his attention out there for the uke to feel. It's not a subtle kind of touch, he is really projecting... He isn't trying to hide anything from the uke, rather he is putting it out there quite clearly and the uke moves his body as the energy seems to dictate. It's not about resisting, it's not about fighting; it's about really letting go of ones own tension so that one can really receive what is being projected.
if one wants to talk about the benefits of training for ones daily life, I strongly suspect that this type of practice develops more skills that can be used to make ones life better than being un-throwable or having a one punch knockout, both skills that are great for fighting but have limited applicability any other time in ones life.