It doesn't have to be a "samurai, spiritual take." There are different kinds of pain, and when people talk about it making them stronger they're not usually referring to the physical type, which you seem to be doing here by saying that it indicates damage to one's organism. Even in the case of physical pain, however, it does make you "stronger" -more likely to survive- by telling you what to avoid.
As for homeless people being an example of how pain only deteriorates, there are three counters. The first is that most people are capable of realizing that, as with all other things, it is in moderation that hardship becomes useful. Too much can be just as debilitating as too little, and the idea that "people experiencing nothing but hardship and thus becoming useless, empty shells disproves that people who experience no hardship become weak" is wrong because it completely misinterprets the latter argument.
The second is that pain makes one stronger not because it is painful but because of how that person responds to pain - an individual of healthy spirit will learn from his mistakes and wish to avoid repeating them, both strengthening himself against them and learning to avoid them outright. A man only becomes a failure once he stops trying to succeed; until then, he is a warrior, regardless of how close he is at any particular point in time to achieving his goals.
The third is that accepting pain is not the same thing as embracing it. Every athlete is familiar with the cliche "no pain, no gain" and it is true; to achieve good results you must go through trials and tribulations, whether this means sore muscles the day after a workout, denying yourself of luxuries in order to save enough money to buy a house or start a business, or sinking thousands of dollars into an education program required for pursuing a particular career. This is not the same thing as pursuing pain for its own sake in the mistaken belief that pain=strength. Nor is it the same thing as passively inviting pain into your life by either doing nothing to avoid it, or believing that is an inescapable fact of existence. The weak do this; they require pain because without it they have nothing, it is all they know and believe themselves to deserve. The great also require pain, but in their case it is because without it, they have nothing to overcome. Without hardship or struggle there would be no potential to rise ever higher.