I went to elocution classes as a child. I haven't read all the thread btw.
I grew up in a house full of Victorian elocution books. We lived with my granmother who was a servant girl in the fens in the late 19 century and she went on a mission to 'better' herself by learning to speak 'properly'. She was self taught - she then went on to run a business that bought her out of poverty. She insisted her four children, one of whom was my mother, also had elocution lessons and then, when I came along, I had them too.
In some ways me speaking 'ever so proper' gave people the wrong impression of me. I was teased a bit at school and when I moved to london in my twenties, some people assumed I came from a posher background than I did. This could be a help or a hindrance (but quite useful in job interviews).
As a shy child and teenager, the knowledge that I could project my voice well and speak clearly was very helpful to me.
My accent now has a slight London twang as I have lived here for nearly 30 years. However even yesterday, a colleague commented on my lovely speaking voice
I think knowing how to speak clearly is a great asset, and something to be encouraged. It has helped me through life on the whole. Speaking clearly does not mean no accent IMO, and does not mean upper class posh.
I think you would be right to encourage your students to speak so they are understood by the whole audience. Can you tape them, then sit them in the audience, play the tape at the volume they speak and show them what you mean? Or would they say they understood themselves anyway as they are at ease with their accent and know their lines? If so, could you tape some other heavily accented actors with unfamiliar accents to your students and make them listen to that?