Teeto_K, that's a fine post and you make some good points, but I'm gonna have to disagree with you some more. Please don't take this the wrong way, I just respectfully don't agree with all your points.
The world (our, REAL world) is full of legendary champions who have never engaged in combat that wouldn't be called "sparring" or "practice".
Martial Arts Black Belts. Olympic Wrestlers.
See, but "sparring" and "practice" is distinctly different from actual competition, where the other guy is trying as hard as he can to beat your head in or twist your limbs off. Full-contact sparring is nowhere near the same as actual competiton. Can a boxer, any boxer, really be called "Legendary" if he never sets foot in a ring for an actual match? I don't think so.
Weapons users of various disciplines. Soldiers even, who've trained extensively, but never seen action. Marksmen, Archers. Going out and actually killing someone isn't a magic panacea that confers skill, despite the insistence of video games to the contrary.
I'm not thinking of "you're not a true warrior until you've actually killed someone" so much as, "you're not a true warrior until you've faced actual combat, the thought of the enemy really trying to kill you and they WILL if you don't get them first". To use the parlance of a thousand Vietnam accounts, it's the difference between the "F.N.G." and the grizzled veteran with the "thousand-yard stare". No matter how much training you have, you don't know for sure how you can handle the terror and chaos of real combat until you have really experienced it.
Though warriors of such calibur ARE rare, they are rare not because sparring is ineffective, but rather, because it takes SERIOUS dedication to achieve such levels of skills. The ability to devote yourself full time to the pursuit. Partners of similar calibur to train with. Teachers of even greater skill to learn from. Reminds me of my dwarven military.
Hey, that's a great paragraph, but your dwarven military must differ from mine. They're effective enough, but I can't call them dedicated. Mine are a bunch of guzzling bums who are just as likely to nip off for a nap or a pint while the goblin hordes are pouring into the fortress as they are to stand and fight the invaders. They work at improving their skills full time, except for when they're sleeping until noon or abandoning their posts for a quick bite to eat.