Hi Mark! I think that Kissomaru and Tohei taught a different, very soft form than o'sensei did that sometimes didn't look so martial. Tohei always had that tendency that eventually led to his aikido being more of a practicing form (yoga-like) than a true martial art. However, i don't believe that the form of aikido that we have today is mainly a reflection of this "soft" form. Take a look at the current Doshu, or Steven Seagal sensei for example. I am certain that in aikido there are people as martially effective as o'sensei was, if not even more, what makes you say that he wasn't teaching his students that way? It's not even a matter of passing the torch, if one practices seriously, nobody can "hide" aikido from him.
You certainly pick a contrast of Aikido styles when you ask us to look at the current Doshu and Mr Seagal. Frankly they are miles apart as far as their Aikido skills are concerned.Note I am not saying one is better /worse than the other just different.