Using that theory, then the Mustang should be the MOST competitive of dressage horses. Or the Chincoteague ponies, or some other feral or wild horses. Sorry, it doesn’t hold water. Northern Europe (Germany and Holland in particular) selectively breed a certain type of horse, and they do influence the FEI in how the sport is judged. No doubt it is a combination of very successful breeding programs (which are partially because of government support and standards for the Studbooks), and then European influence over the judging process.
The Warmblood is NOT bred to survive in the wild, it is bred to be competitive in the equestrian sports.
It is a WAY OF LIFE in Germany. Horse sports in Germany is like baseball and basketball in the US. Government supported, people supported. In the US, horse sports are considered elitist, but when you talk about ball sports - we support them. In the schools, in the parks, everywhere. Want to play a quick pick up round - there is a basketball court in every park in every neighborhood! Softball/baseball, same thing. There are teams in the schools, neighborhood leagues, parks and recs leagues.
Go to Germany, and you will have a harder time finding a basketball court, but there is a riding school on every street corner (I know, not literally!). And like ball sports in the US, it is inexpensive with government funding and support. As you even note in this next quote.
Government supports horse sports in Germany - it does not do so in the US. As I noted above, Government supports BALL sports in the US. So in Germany (and much of northern Europe), kids are brought up riding, it is inexpensive, access is easy. In the US, it is expensive, access is non-existent. How many riding schools HERE can you think of with schoolmasters, or heck, even decent lesson horses? I live in a pretty horsey region, and you can find a few (FEW) places with lesson horses, but they are up-down, beginner horses. I can’t find a single place to go take a lesson on anything 2nd level or above. And the lessons are expensive. There is no government support.
Germany has a better system for dressage - NO DOUBT. But what is your point? I don’t think anyone disagrees, but it isn’t going to change here. Our society views equestrian sports as a hobby of the upper class. If you want to do something with government backing, go take up baseball…