I think that the key to finding an answer (as is often the case) lies within formulating properly the question.
Learning "kung fu" by itself is difficult to define, since basically kung fu means simply being highly skilled in something (as compared to wushu which is the actual fighting training).
But, to get closer to your question, how do you actually define "sparring"? This is not a so easy tasks as it would seem at first glance.
Here are just a few example of "sparring" that are used in certain contexts:
a) Simply a pre-arrange practice of certain patterns with a partner (no "free sparring")
b) Free (within rules) full-contact fight
c) Free (within rules) fight with only light contact
d) Free (with no rules) fight with only light contact (hopefully!)
e) Role-play sparring (i.e. one plays the role of the attacker, while the other is only practising how to dodge or block)
So, to answer it is important to define what you exactly mean with sparring, and how your teacher is exactly going to train you and how not.
All the different example I made may provide different outcomes, even the most "similar".
For instance, b) and c) would seem similar - and probably are what most people define as sparring - but, in my opinion, are very different kind of training.
Practising full-contact (or anyway using a lot of power) will probably allow you for much less technical and strategical development, but might "toughen" you by making you accustomed with being hit. You might also consider that your self-confidence (which is an important predictor of the outcomes of a possible fight) might be better developed by using other forms of "sparring" (or even other forms of training altogether)
Other considerations are needed as well. If you want to "protect" yourself and others there are other factors beyond the mere "fighting skill". It has been shown that, regardless of sparring, martial arts training can make you a less likely victim by making you more confident (implying an aggression is probably an act of cowardice), or by being able to deal better with a potentially aggressive situation (without an actual fight happening). This is best learned through "traditional" martial arts styles of training as compared to "modern" competition and sparring focused training.
Also, what are the techniques you are actually using? If you are going to rely on strong punching and kicking, you can learn that quite effectively without most of "sparring". If your preferred style is going to rely on skills like dodging and evasive moves, timing and distancing will play a crucial role, and it will be complicated to learn those without an actual practice.
You must also consider what are you training for and what kind of skills you will learn by sparring. I mean that difficulty you will spar in a way that actually resembles a real street fight. But, again, maybe that would be exactly how you plan your "sparring" session (do you "point fight", or put on all the protections and mimic a full-blown aggression to vital points as well?), so we are back to the definition of what you actually mean by sparring.
As a conclusion, in my opinion some sparring is beneficial (and I generally have my students practice some form of sparring in any martial arts class, compatibly with their goals and skills). I usually try to mix in different form of "sparring" (I personally find role-playing highly useful). That said, many effective alternatives can be found to probably most of "sparring" (visualization, conditioning, psychological change). In the end, it depends on what you actually want to do (what is your final goal), and what you are actually doing (what kind of training are you doing, and what kind of techniques, and so on).
I am aware that this answer is not really... an answer! But I hope it will be useful to you by giving you some deeper insight in the concepts you are thinking about!