Welp. No clue how to use the spoiler thing, so I'll just respond without it.
1. Yes, anything that does not serve an actual function in the game - this one being as you said, a stat-based game - is purely aesthetic. Everything you mentioned can be done without even having a Sensei. So, general rule, if you can accomplish doing something without even needing the system in question, the system is unnecessary.
2. TNR has meaningless PvP. Multiple threads have shown an interest in PvE features in this MMORPG, suggesting the inclusion of the feature into War, missions, daily events, etc. TNR is an MMORPG in a Beta stage that doesn't currently have many engaging PvE elements. All of your events are generally PvE based, not PvP. Your claim would be more viable if this wasn't the case for the previous cores. Additionally, what I'm saying is instead of staying in the same mold that is currently a sinking ship, we include more features to make the game more presentable. PvE on itself will only grab a portion of the total audience, just like PvP on itself will only grab a portion of the total audience. Instead of neglecting one or the other, having both be engaging and enjoyable like other MMORPGs would be the ideal if we want TNR to have a larger audience.
3. In WoW - when I last played in Cataclysm - I did get PvP for capturing objectives and finishing quests centered around PvP. COD does have separate story modes and online modes. But it is not an MMORPG like TNR is. COD doesn't have stats, it has guns that you unlock. COD centers more around the skill of the individual in constantly changing combat scenarios. Essentially, you progress in COD through skill and muscle memory, not through statistical advantages.
It IS a choice to train effectively. Players can choose to rank up and receive extra regen, launching them closer to Jounin or increasing their HP gain from an EM and a mission with greater buffs, potentially taking their career to Jounin for even further gains. Or, they can choose a safe route. Have lower regen, but more missions more frequently, and gain more ryo to be able to afford future expenses. Many players who play on mobile or aren't as serious might take this route and enjoy it better.
Ultimately the leveling system should change from one where you have a maximum potential number of missions the second to sign up, to a system where your effort in PvE and PvP gameplay makes more of an impact than anything.
4. I liked how you ignored the immersion points pretty quickly. Regardless of if players should/shouldn't be able to do it, it makes no viable sense. A player from a completely neutral village is just allowed to stand in your village, waiting to inform another player (or the same one) that there are members awake in the village? Or furthermore, a player can have a completely unattackable alt in the village to let them know where everyone is?
If anything is unfair, it's this system. Genin have no purpose for Scouting Area to begin with unless you're abusing this feature to get kills. Genin cannot be attacked, and therefore have zero reason to be in the PvP scene.
Ryo Increase- Serves no function, Genin houses, items, and hospital bills are more than low enough as is, there is no legitimate reason to increase the ryo gains, not any reason WHY having a sensei would increase ryo gains from a logical point of veiw, your just giving extra ryo to people who have scouting alts.
This would be what I am referencing. You stated that it has no function, so I was giving you the reasons why it would serve a function. Instead of giving another form of currency that would impact the game more - VF, Reputation Points, or Popularity Points - Ryo seems pretty minimal. Adding additional ryo/mission gains would simply be a low-impact incentive for Genin and Senseis.
Refer to an above statement regarding missions, about it becoming a system of effort rather than potential time.
Genin as it is, is an okay rank. It includes many new features that keeps new players engaged, and honestly, it is a fun feature. But we're not talking about Genin. We're talking about the Sensei system, and what should/shouldn't be added. Right now you have it in your mind that this system is functional, when it isn't in any way other than Role-play. Just like with all systems, this needs more content and incentives to keep it engaging for all players.
Things that are good ideas for the Sensei system:
1. Chuunin/EJ Student buffs
2. Viewing Student stats (doesn't really matter, Students can just screenshot it..)
3. Sensei Board (If it works like a Help Wanted thing, that might be interesting, otherwise it will most likely be another useless chat)
4. Extra missions as well as decreased mission timers
5. Increased ryo/training gain for having a Sensei
6. Diplomacy gain for Sensei and Student?
7. Item Shop reduction
8. If keeping the Scout Area with Genin, give it a purpose. Maybe a tutorial through the professions, making early items.
9. Just more content all around.
There's a lot that needs to happen in TNR to make it overall more appealing, and to get a larger population base. The Sensei system as it is, I see zero point to it. I can help every newcomer (and I do) whenever I can. Guidance is not limited to the Sensei feature, so it needs some genuine functional support to make it an engaging system that brings content to Senseis and Students alike.