In my experience playing with technical players who are ignorant to theory, I find them much more "mechanical" than those who do. Regardless of if you know theory or not, you're brain is actively planning/executing lines when you play. The person ignorant to theory, when it comes to technical lines is very restricted, generally adapting to a "this finger goes here, than this finger goes here" type approach. While the person who knows theory, can analyze the lines, understand the rhythm, the harmony, the melody, and as a result can embellish them.
Understanding theory, when it comes to technical music, makes it much less like learning dance steps, and it makes it more like playing music. It's like communicating in English, without understanding grammar. It's possible, many do it. Yet understanding grammar just helps you convey your intended meaning more efficiently. It heightens your intuition in conversation, it allows you pick up on subtleties (especially with humor).
I think most people to go through a period, when learning theory, where they restrict themselves with it. As you point out, some people will complain about something not fitting with theory. However that doesn't really make sense, and speaks more for their still small knowledge of theory. Theory isn't a rule book, music doesn't fit to theory. Theory is simply a streamlined method for understanding music. There are no rights or wrongs for what tones can go together. People who you have encountered with that attitude are misinformed.
This is what I was trying to get at with my post, It's not the theory that limits the player, it's their understanding of that theory.
But also, I think theory is what it is... its a theory, not necessarily fact. There are many different theory's out their, and some of them contradict each other. All work for different people. I think its about finding that right mix of different theory, feel, intuition, and creative expression, that will work for you, and then find some others that can share that vision and play with you.
at the end of the day, music is art, and their is art theory that goes along with any media. The real fun for me is sharing ideas, and theory, and concepts, discussing them, and trialling different things with other artists, to help expand and further everyone's knowledge and understanding... kind of like what we're doing here!
I guess what I was trying to say was that, some people see art in black and white, because that's the way they have been shown it, or that's the way they can understand it, the truth is art exists in a whole spectrum of colours, if it was all just black and white, right and wrong, it wouldn't be art.