Roger,
This is a great point. I don't see the need for a practical test (a check ride in the airplane) because while mil. to civi. guys may not be great 172 pilots (or whatever it is they are using the license to rent) they did demonstrate at least commercial level skills in their military checkride. Granted, the manuevers are a little different, but the skills translate sufficiently. And the commercial license doesn't have a specific airplane associated with it, just "complex".
What needs to be fixed is the test. I don't remember much about the test, but I remember that it was really easy. I don't really remember what it included, except that it included VFR cloud clearances and airspace classes.. which I already knew from my mil training anyway. I actually wish it covered a little more. My own knowledge on some of those topics is piss poor (anything that we don't do or do differently in the military). Of course, I've only flown civilian a handful of times, and always with someone else, so it's not like I really practice it, either.