And what makes you think she was being tested at Beacon at all? Firstly, she was never enrolled at Beacon, she was only there to participate in Vale's tournament. At best this is testing her capability as a combat android, if not also being used for an ulterior political motive. And it's still vague as to what she was being tested for, if she was being tested at all. Nothing in the show or supplement materials suggest that she wasn't a finished product, nor a prototype of any sort. And it's that vague idea of a robot capable of using Aura that I created Gren from.

And if you're saying that objects can't be powered by Aura, then you're also contradicting anothing thing you told Ryo a long time ago when you were arguing about how Ebon is controlling his R-Types. You said that he could use a device that interacts with one's aura, so I imagine that Gren is working off a similar devise, only his aura interacts with said device to power his entire body as oppose to remote drones. You can't just retract that statement now just because Ebon isn't in play anymore.

Also just because it's powered by aura doesn't mean suddenly everything else is obsolete. Because as I said, what Gren uses merely uses Aura, it cannot produce aura on it's own. While it can take aura as a power source, that doesn't mean suddenly all other forms of energy is useless because there is a price to use aura powered machines, and that price is that it needs a person to power it. Gren's machine can be powered by himself since he only needs it to power his body, but you can't use one person to replace an entire power plant meant for a city. Unless you're going to start using people as human batteries, aura powered machines on a large scale is impractical and possibly inhumane. It's not as if you can just take aura in a raw form and exchange it with others, not unless you have the same machine that powers Penny. Which while is still a mystery to us, we can be certain that it's not common place and Atlus may be the only ones who have access to such a thing.

And it all returns back to what I keep saying: Gren, despite all his bells and whistles, is a fairly lowtech version of what Penny is. She is a machine that can produce her own aura, as well as other additional abilities including strength that could match Gren (He could probably stop a truck too if he saw it coming) or even greater (Gren likely can't pull down [url=http://rwby.wikia.com/wiki/Bullhead]Bullheads[/url] even if he had a hold on them. Shoot them out of the air, sure, but he can't do [url=https://youtu.be/WLZq4hvs_30?t=154]this[/url].), all while being much, much smaller then Gren, meaning that she's achieving the same level of power Gren can muster but with far less tech to accomplish it. As I said before, the only real benefit Gren's cybernetic body grants him is the ability to carry heavier armor and weapons. His thrusters were not an original part of his body, which he only added after earning enough credits in this RP to pursue that upgrade. And that is specifically not powered by aura, but a biofuel he has to make himself.

In fact all these explosions he's been getting himself into is his attempts to try and replicate the same technology he relies on to function, with very little success. Yes, the technology he's using is very little understood, even for him. It works, no doubt about that, but how it works is largely a mystery. The best he can do is try to make use of it's output, which at the moment is simply letting him use his Aura over his robot body. 

And if you're questioning why he would use something he doesn't understand, you could say the same about using cars. If my car breaks down I have no idea how to fix it myself, and I'd have to take it to a professional. Someone does, just not me, and as long as it doesn't breakdown I can continue to use it to the best of my abilities, and overtime figure out how to work out any errors short of total destruction. In the same respect, Gren's body is like a car. He knows how to drive it, and has a workable knowledge to improve and repair some of it. But if he fucks up so badly that he breaks something very critical, he's going to need professional help. And unfortunately for him, the only people who would likely know how to fix him are either the White Fang, who stole the technology he's made from, or Atlus, from whom the technology was stolen from in the first place. And it's all the more reason why he continues to layer armor and aura over himself to minimize the damage done to himself, as well as trying to improve his mobility to avoid damage all together.