I am a Performing Arts teacher and yep that is what I do - purely because I can't play an instrument! As far as PA teachers go though, I am a bit rare in that, but even so most I know use CD's. Having said that though, most good teachers will find a backing track for kids to sing with rather than trying to compete over a CD. I also do a bit of a cappella work where the kids sing without anything behind them which is lovely.