Well, the obvious argument to that is not to tell the student that their valve is closed, but rather that their PO2 is dropping. Or even tell them what the lights in the HUD are doing. Student still has to work through the problem, but isn't in actual increased danger. TDI even makes a little prompt slate for just such a teaching moment so you don't even have to write it down. If the student is in enough of a task loaded state, it will result in plenty of thought processes being tested.
-Chris
But there really is a difference between getting a card flashed at you and then going through a memorized drill that you were told was going to happen, and actually having the experience of your PO2 dropping on all three cells, in real time. For one thing, it wasn't until I did that that I really appreciated how slowly PO2 drops with no O2 inputs, and what it actually looks like if it ever happens for real, and what it looks like to fix it.
There is a reason why airlines spend millions on very accurate simulators and don't just tell the pilots that their altitude is dropping. Now I guess the answer to that from your point of view is that they use simulators instead of stalling an actual airplane (TBH, I don't know if they do that or not).
But all I'm trying to say is that this teaching tool was very effective for me and a lot more of a learning experience than just looking at a cue card that I knew was coming. If the CCR instructors here tell me that it's so dangerous that the risks outweigh the benefits, then I should believe them. But since it takes more than 5 minutes for the PO2 to drop to hypoxia, and since the instructor can clearly see the controller and turn the valve in a second, it seems that this could be done with acceptable safety. And I'm probably wrong.