Tough, frequent, realistic training is exactly what is required to keep certain parts of the military prepared. I'm not talking about logisticians or acquisitions types. Personnel turnover is a problem. People must learn how to work together. For people like you and I, we have the opportunity to learn to work with our coworkers... every day! In the military, a service member only really learns how to work with their coworkers during these kinds of exercises. When it's cold. When it's dark. When everyone is tired and hungry.
You've also suggested that "the military has the tactics and hardware to engage in urban settings down pat" ... and you're absolutely correct. Senior personnel have lessons learned. Those lessons are captured in various documents. However, much like a start-up, execution is everything. The execution comes from personnel who typically have just a few years experience. There is an enormous amount of knowledge which must be transferred in a short period of time. These training events are how the lessons and doctrine are shared with those junior leaders. Classroom instruction is not sufficient.
Finally, I will disagree that the training event was "odd in it's conception." Certain parts of the military perform these kinds of exercises regularly. The only part of this exercise which was odd was the amount of attention it garnered.