1. I think you could have a serious discussion about the use of "militaristic" training methodology throughout most of Japan's fighting history. Most of the Western concept of military, derived from the Romans, would not have applied directly to Japan's feudal fighting system. A national, militarized, armed force did not come about until the fall of the bushi class. You could argue some of the warlords had a militia, but that would have been a private fighting group.
2. Budo was a tool to integrate a fighting class into civilian society and invigorate a country's national pride. I think the romanticism of the tool has created a philosophical perspective that is redundant in many respects to other larger philosophies. Not that this is bad, many of the 7 major religions share significant similarities in personal ethics and behavior.
3. Etiquette is a constraint in normalizing expected behavior. It's a way of preparing the expectation for how one should act. For a country like the United States, many Americans value the individuality of personal expression and the idea of expressing individuality constrained to be similar to other expressions of individuality is, in reality, not an expression of individuality.
The fact that budo has been packaged as a separate philosophy grounded in a warrior culture is maybe an observation about what motivates our behavior. It's not using a minivan is a problem for getting around town, it's that they are so uncool. It's not that staying in shape isn't important, it's that nobody can see you working out. Doing budo is both cool and something everyone can see you doing and that is a desirable package, even if the message is the same as some other number of philosophical messages.
There is a great short book called, Patriotism, by Yukio Mishima that is an interesting read reflective of the imperialist movement in Japan.
Jon you are so wrong about minivans. It is like someone took a crossover or SUV and said "hey maybe there is really no need at all for the ground clearance and sad AWD system that would never be adequate for serious use, can't we get a little more room and comfort in this thing if we take out the parts that aren't needed." AND VOILA.
A few other things - Japan actually had a standing army of conscripts in the first millenium. They decided to do away with it, and this is one of the factors that led to the rise of the bushi class.
Budo became a tool for creating national pride in modern times, but before then it was all about the individual and how he related to society.