I never tipped my instructor... but then again my dad was my instructor, so I would have had to ask for money from him so that I could hand it back as a tip
I receive tips from time to time... obviously they are greatly appreciated, but NEVER expected. Personally, I do what I do for the love of the sport, and charge as little as possible so that I can continue doing it. As such I'm always walking the fine line of economic demise...
To me, you pay the rate asked and if you get what you expected for that money, no need to tip. If you feel like your instructor, waiter, whoever went above and beyond and did an extraordinarily good job, then maybe you should tip them. Again, not expected, but always appreciated...
As others have already said, a little loyalty can go a long ways... anyone in the business knows they can't always be the cheapest source for everything, especially with direct-from-manufacturer internet pricing on some products... going through your dealer when you might not otherwise IS a bit of a tip (granted, they are doing more work to earn it... but it's still income they wouldn't have gotten otherwise)...
I'm sure Cal is going to jump in here and say he's tried to tip me and I wouldn't have it... however I didn't go above and beyond for Cal, I just did my job and he tried to over-pay me for it
Shut up and fly.