Just an interesting thing to add to this thread...
I just got the March/April copy of rifle shooter magazine. There is a test of three AK's. All three of century's inexpensive models... The WASR-10, the GP1975 and the M70 underfolder. This is a real test done by an unbiased source... Groups were at 100 yards using open sights.
Accuracy results are the averages of three - five shot groups fired from a sandbag rest at 100 yards.
Romanian GP WASR-10
American Eagle FMJ: 5.61"
Winchester Super X SP: 3.01"
Wolf steel case FMJ: 6.93"
Century Arms GP 1975
American Eagle FMJ: 2.16"
Winchester Super X SP: 4.85"
Wolf steel case FMJ: 3.93"
Yugo M70 AB2
American Eagle FMJ: 1.36"
Winchester Super X SP: 1.82"
Wolf steel case FMJ: 2.82"
Not match grade, but also not exactly the minute of barn you hear some people complaining about.
I personally own a rather large collection of AK's.... and my experience is some what similar to those described above. I personally have not seen many sub-2" groups using iron sights at 100 yards, and the few that I have seen I've written off as luck because the normal grouping for me is 3"-6" depending on rifle and ammo. I have seen lots of sub 2" groups using quality ammo and an optic so I've always thought the limitation to my accuracy was my inability to use the iron sights, low quality ammunition and not the fault of the rifle due to the improved grouping when using an optic and quality ammo.
Although this thread originally was discussing real world accuracy of AK's... like all AK threads it has turned into a comparison between the AK & AR. In my experience... I've always been more accurate with an AR. Not the massive difference that many seem to post about, but my avg group size with an AK is 3-6" and my avg group size with my AR's is about 2-4". I mostly shoot cheap steel cased ammo out mf my AR's as well so it can't be blamed on ammo, so I have always just added it up to being a slightly more accurate rifle out of the box, with much better sights.
So in summary yes I believe the AR's are slightly more accurate, part of that i'm sure is the design of the rifle, but IMO a lot of that is the quality of the sights. But, in my experience AK's are reasonably accurate guns if you actually shoot for accuracy and are more than sufficient for a battle rifle, the problem in my opinion is a lack of ability with the AK's more crude sights and maybe the fact that because people don't expect much for accuracy out of an AK they never actually take the time to learn how to use the sights and improve their ability with the rifle.