I don't buy it. It seems much more likely that the lion's share of unsuitable candidates their instructor gets knocking on his door are Aikidoka and want to train in the source of Tissier's sword,
I'm sorry, but: Nope, don't hink so.
One of the two German aikikai affiliated federations is lead by Tissier and Endo. (This is the one I belong to.) So Tissier's aikido and swordwork is well represented in Germany. Lot of dojo, lot of seminars. All over the country, all over the year. Also Inaba himself is teaching in Germany. And there are even dojo, where his swordwork is taught independently of aikido.
So, there is a very good infrastructure and publicity, a lot of dojo, where you can find Tissier's sword. And in Frankfurt Tissier is very well represented for over twenty years now. It was one point in Germany where Tissier's (and also Endo's) way in Germany started long long ago. (When I began to practice about 18 year ago, it already had spread out into the whole country.)
I just try to tell you, that it is clearly not such "organisational" issues which cause the mentionede prohibition and the - in Germany well known - conflicts between KSR and aikido.
Someone who knows who Tissier is and who wants to learn his swordwork will "never" end up asking at the KSR shibu. He won't even find it without help.
Some years ago I had long and interesting conversations with a member (not the one holding the menkyo kaiden) of the German shibu of the KSR. And it became very clear, that the ban of aikidoka in the KSR shibu is founded in the teachings of the ryu. It seems to become evident when you practice long enough to understand what Frieday calls "the kabbala" of the ryu: The inner teachings, the "ura" doctrine.
Whether it is true that there is such a deep gap between the inner teachings of KSR and aikido I am not able to judge.
I could see requiring new students to drop all other arts entirely ...
...the prohibition is particularly against Aikidoka.
There exist, as far as I know, only three European shibu of the KSR. In 2008/9 when I was in contact with the shibu in Frankfurt/Germany they indeed required to drop all other arts entirely: No aikido, no kendo, no other koryu budo, even no boxing or tai chi.
Maybe things have changed since then concerning other arts. But aikido is still excluded.
... it really seems like there is something else going on ...
Yes, I think this indeed is true nevertheless.
A complicated, all too human story maybe ...