I had a conversation about this with a colleague once. It seems like there are two types of people - those who are really calculated and orgenized, and are good in learning patterns an repeating tedious tasks in order to learn, an those that are spontaneous and jump between things and ideas, and learn and advance in sudden "bursts" of action.
We observed that people of the first type will often be good "technicians" - they will learn fast and have perfect technique in whatever they do, but when asked to improvise they will freeze or be lost with all the options, and their results will always feel "forced".
People of the second type will usually be brilliant freestylers, but will have a hard time focusing and learning things that require precision and repitition, so their technique may be sloppy at times.
(Of course this is a spectrum everybody is somewhere between those ends).
I am of the first type, and it has always frustrated me - no matter what kind of art I try to create, I can never stop being calculated. When I paint, I can copy the most realistic pictures, but I cannot paint an abstract. When I played the guitar I could play all my scales and the most complicated solos, but in 6 years I never managed to improvise to a song. When I pole dance, I learn the tricks really quickly, but play a song and tell me to express myself, and I will spend half the time standing in the corner looking silly.
I think that most people expect that when you improvise, you will do it like a person of the secon type does it - this is what you wrote, scarletthoney - that you will "let go" and the creativity will flow.
But for us calculated folks, letting go is the problem, and I find it often helps to practice letting go intentionally. One way I find very useful, is to let go in small steps - you keep some rules, and improvise within these rules. The fact that you still have some structure really helps the "too many options" fear. Once you get used to that, you remove some limitations and repeat.
So for instance, you could start by working only with 3 moves that you like, and play with transitions between them. Then, when you feel comfortable, limit yourself to grounded moves, and decide that you must use these 3 specific moves in your freestyle, but you can add other things as well. You get the idea. This gives you some structure to work with, while still allowing a degree of freedom to be creative.
I know that some of the more spontaneous people feel this method kills their creativity, but we all work differently.
I also find it very helpful to practice just letting go before I freestyle - maybe doing stupid and grotesque moves on purpose with a song I like, maybe dimming the lights and rolling on the floor feeling sexy, mayby smearing all my colors in my pallete with my fingers on a fresh sheet of paper, whatever.
I think that perhaps instead of telling your students they can let their words flow, you can help them ease into it by turning it into a process using similar kinds of exercises.
Just a thought :)
