If you're training for self defense, then live scenario-based pressure testing is probably the closest thing you can get to a self defense situation. The attacker(s) has a plan to loosely follow, based on common pre-attack behaviors and common attacks, and the defender doesn't know what will happen. Once the actual attack begins, the attacker becomes a resisting, reacting opponent. A third party needs to be standing by to break it up if the situation becomes too unsafe, or if it is determined that the attacker or defender has probably been neutralized.
Sessions should be broken down by the instructor to point out important signals to watch out for, and what mistakes were made, so they can be addressed in training. Contact should be hard, weapons should be involved sometimes, protective gear should be worn, and verbal de-escalation and running away should be possible options for resolving the simulated conflict, if applicable. It's live sparring, but it's managed to simulate the types of situations you expect to be in. Think of it like a fight camp--if you have footage of your opponent, you will probably use that to have your sparring partners try to emulate your opponent's fighting style, right? Same idea.
All that said, even normal combat-sport-style sparring prepares you for self defense far better than doing nothing but drills. You NEED to experience being taken by surprise, getting hit, and having your techniques fail. That's how you learn to overcome adversity and perform under pressure.