Hmm, the title isn't exactly accurate - your questions have nothing to do with 'teaching' per se, more along the lines of 'people think they're better than me because they wear different clothing'.
If you do a search for 'wearing hakama' and read some other threads, you may get some answers or indeed come to some conclusion about the wearing of hakama. There seems to be as many varieties of 'who wears what' in as many dojos as there are out there - and other than those who are insecure about it, it makes no difference, in my opinion.
For some it's a historical/traditional thing, for others, a practical one. For others, hey, perhaps they just feel like it!
I train on a regular basis (half my time in each) in two different dojos. In one place I wear hakama, and in the other I don't. And it's merely just to go with what is done and expected of my rank in each place. And apart from the extra time taken to tie the thing on and fold it up after wards, it doesn't make any difference to the training, or how people treat me.
As far as visibly displaying rank with a coloured belt or the wearing of hakama - I think it works fine if that's the norm. I also don't think there's anything wrong with being proud of your achievements, as long as it's not just a status symbol, or encourages conceited attitudes.
I trained once in a dojo where there is no rank at all - The head instructor doesn't even issue dan grades, and he's more than qualified to. And his system seems to work there. Maybe that's just Kiwi's though!
Also, and just to throw a spanner in your generalizations - I've trained in a dojo in Japan where the kyu grades wear coloured belts, so it's hardly a western invention there. And again, the system works.
To conclude, just follow what is expected where you train. Like aikido techniques, I don't think one way is necessarily 'better' than another, just different. Also, when folk cry 'rank is unimportant' - to me it seems that it really must be important to them or else they wouldn't mention it!