I've read, and have been told, that during the Kobukan era folks would regularly come in for "Dojo Arai." On occasion, when more formidable "guests" would come in, their "interview" would end with them literally broken. In these cases O-sensei would come out and scold his student for injuring the "guest" when his art was not meant for such violence. After the guest had left the founder would invite the "defending" student into his back office offering him a cup of tea and congratulating him on his fine performance . . .
This of course was a "challenge match" (not the typical cheap shot that Ellis described) and all parties involved knew it.
. . . an obvious question is how much was Morihei Ueshiba aware of things that were going on? How did the situations at both Iwama and Tokyo change on the death of the Founder?
Perhaps an extreme reframing of the question would help one to draw their own conclusion: "Did the body guard assigned to protect the assassin by the fanatical/ultranationalist backing religious 'god father' know that people got hurt in his dojo where members of the ultranationalist underground did at least part of their planning that used terror as a tool?"
If he did or didn't, does it make the described behavior any more or less condonable? We can't change the past, but we can learn from it. What should one do now?