My DD does ballet jazz and tap.
There was an optional exam for ballet at age 5 (pre primary) then exams each year after that, we haven't taken them that seriously and DD came out of the exam last year with a big grin saying that was fun. (She is 8 now.
There are exams for tap and she could do modern with exams, but I feel the ballet exams are enough for now.
I do like that it is quite strict for class, they all wear leotards, supposed to be RAD ones but you still see angelina ballerinas and all that up to about grade 2. DD was in her exam class today with bright purple bratz socks today , they do encourage buns, but they do this by giving them a tick each week they have a decent bun in and when they get enough ticks they get to choose a present from the box.
They do shows, big one in the summer (public can come) the little ones do one night and the under 5's have there own little show. At christmas they do a show in the dance school for rlations only and again the little ones do one show only.
I like the school as it is very professional, just strict enough and self contained with a cafe, there is a good atmosphere and I feel they look after the kids. The older ones hang out there and help in the cafe as well as assisting with the younger classes. I will be quite happy if my DD spends loads of time there after school when she is older.
I would follow your instinct, if you don't like it and don't feel comfortable with it stop for now or find a fun one. Look at how they progress them and what costs are involved in the future. Some types of dance are very competitive like disco and require loads of costumes, others like ballet are not competitive but might involve a few shows. Sell her uniform on if it cost a lot, no doubt it did.