I found that when I train with a live blade, I am more careful with my technique. This is why I think that after a few months of training, one needs to try a live blade. Also, when I tried to draw a sword for the first time, I found that drawing the bokken from my belt did not prepare me for that.
This is why even though I cannot afford a good sword and have to settle for something cheap, I think that handling a real sword is necessary for mastering the art.
Of course, if O Sensei had such a terrible experience, I would not blame him for hanging his real sword, I would probably do the same.