I experienced direct transmission of a sort in a couple of ways. I have been to the Shiseikan in Tokyo a couple of times and studied Kashima Shinryu kenjutsu with Inaba sensei (link to Karl Friday's book - although Inaba sensei studied with previous head of KSR and is independent of current head - another story).
Anyway, when Inaba sensei takes ukemi for you in kumitachi he is able to bring things out of people (myself and others) that they can't produce in other situations. It is a combination of pressure and intensity that achieves a higher level of performance - but also leaves behind a feeling or experience that is beneficial.
In another situation I have had him work on me while I was sitting seiza. He basically prodded me, manipulated me, stretched me and "put ki" into me for 5 minutes or so. This left me with a very powerful feeling and shortly thereafter while practicing for a demonstration the next day (one on one randori), I was much more effective than I had been - noticed by myself and uke. The feeling lasted a while (but unfortunately had gone by the demo the next day!).
I have heard others talk about him being able to give people feelings which in a way are a challenge that they then need to learn how to generate themselves (which takes years).
So, I believe it exists. I also believe as others above, that being around good teachers as uke or whatever brings good results.