It's the "Blah Blah Blah" effect that most Bona fide instructors suffer from. For many students it is not their fault. They are looking for someone to respect and look up to and know no different when they are fed this bullshit. The amount of times I have had someone come into my shop saying that they do Thai and then head for the full contact trouser section etc etc.
I have no problem with the shitters unless it affects me and my club really.

One little problem I have is people who have been training with me for two weeks or may be not at all, getting into scrapes and telling people that they are "From the Bulldog and will be back with a team". Then I spend the next few days getting calls from concerned clubs / pubs or even the police wanting to know the crack. My response is always the same - We don't do gang fights and drunken beatings & we don't make threats. Anyone who pretends they are with us will recieve no protection from us, it's not what we are about.

You are right, it is bullshit from all angles. Insecure instructors with no track record, making one up. Insecure students trying to be part of a respected crew, jealous instructors trying to bring you down. BLAH BLAH BLAH.
The quality will always shine through, so fuck 'em