With the proper constraints and epuipment, provided one can create a realistic enough environment, has the possibility to make things more interesting. Creating situations in a classroom is one thing, making it real is taking it to another level. Like blindsiding a student outside and seeing if they've learned anything and how they can apply it. If the situation is real, how will one react? How will one react, when they've been trained in reactive scenarios?
It's must be a class excorcise, every student of the martial arts should know full well how to defend themselve's. My kung fu teacher encouraged street fighting and picking fights with gangs and such. I don't want to take it as far as I had to go, just a taste of random.