Just played realistic mode on singleplayer and I find the game far more enjoyable when I actually have to read the opponents' moves instead of just watch the glowing red arrow and hit the same direction.
With the bright glowing red arrow UI, the game has a much lower skill cap than many other competitive action/fighting games. Also, it promotes defensive playstyle since everything is so easy to block/dodge, even with feint attacks. With such defensive gameplay, the game will become far too slow and boring for competitive/e-sport (a good example of this is Street Fighter X Tekken, where the game is a turtle-fest, and the competitive/e-sport scene died within a year).
There should be an option for realistic mode for multiplayer or ranked matches in the future. This would allow a much higher skill cap, and better viability for competitive/e-sport scenes.