“We are limited, not by our abilities, but by our vision.” Anon
When I was young, I learned music by ear. I would meet with my band every week for many hours, and we would decide on what songs we wanted to learn (heavy metal covers mostly). Then we would learn the songs together or separately.
The nice thing about learning music by ear is that you always have a clear vision (the recording) of what the music should sound like when you play it. You can keep checking to see if what you are doing sounds like the recording you are learning. Eventually, the recording gets into your inner ear and you can tell if what you are doing sounds correct. This is how I learned to play music.
With classical guitar, we learn music by reading written notes. One of the advantages to this is we don't have to guess what the notes are - unlike learning by ear. All the answers are there. However, one of the disadvantages is that we can practice a piece without knowing it. We can get into the habit of reading rather than hearing the piece with the inner ear. For example - the student will practice a piece, but slows down at difficult passages. Most of the time, they don't know that they are adjusting the rhythm. They can't know because they have nothing to compare it to - the correct version is not in their inner ear.
I believe the inner ear is one of the most important and overlooked parts of musicianship. Our inner ear is our "recording". It's our vision. The clearer our inner ear hears the piece, the easier it is to follow it and express it - just like a real recording.
Guitarists tend to do most of their practice with the guitar in hand, but it's equally important to practice the inner ear - read the score, feel the rhythm in the body, let your imagination run free with ideas. Do this without the guitar every day. This strengthens the "inner ear recording" of the piece. By doing this you'll see great gains in your rhythm, memorizing and overall musicianship.
Keep in mind that we are ALWAYS expressing our idea of the piece - whether it's clear of not. The word "express" is defined as "to put thought into words; utter or state: to express an idea clearly. Focus on getting the idea clear so that you know what it is you are reaching for in your physical practice. It seems basic, but is overlooked by most of us.