In the practice of real martial arts, having a good partner to spar against is essential in training. As someone else mentioned, shadow boxing on your own will help you train your moves, but will do little to actually prepare you for combat.
So who did the wulin elite fighters spar against? If we say "each other," we need to account for the fact that the elite fighters didn't encounter each other very often, let alone sparred with each other. Kiu Fung wasn't sparring with Kau Mor Tze in DGSD. The Greats only met once every twenty years at the Mt. Hua Sword Tournaments. They couldn't spar against ordinary fighters because A). it would provide no challenge and thus, no improvement and B). they'd likely kill their sparring partners.
Many of the advanced martial arts that emphasize inner power are more about sitting down and meditating rather than sparring, but still, without sparring, how are the elite fighters to hone and refine their combat instincts? Who (in the absence of other elites) can they find to spar against?