Good playing isn't that difficult really, but it sure seems so when you are learning! Guitar students are so often plagued by misunderstanding, physical difficulties and neurosis that sometimes the best thing you can do as a teacher is just be positive and affirmative. I think that the best guitar teacher I worked with did just that with a minimum of commentary.
So what do I mean by "a calm mind and a quiet hand?" I guess I should define both of those things so you know what I am talking about. Let's start with the easy one: a quiet hand. If you watch some great guitar players to see what you can learn, it is amazing how little you see--with classical players at least. They tend not to do wild, arm-swinging power chords while leaping in the air like Pete Townshend of The Who:
Quite the opposite:
The ideal is minimum movement. The right hand is particularly difficult to see what is going on, because if your technique is really good, nearly all the movement of the fingers is concealed by the hand. Here is a good example:
And that's Manuel Barrueco ripping through some particularly virtuoso passage!
The problem students have is that they are impatient and obsessive (often), which means that they are always trying too hard, working too hard, playing too hard and struggling. If you are struggling then you have to stop and start again. The way to approach everything is very, very, very slowly and gently until you have the physical movements under control. From there on it is just a question of gaining surety and speeding things up. But always under control! A quiet hand gets the job done quietly.
Roughly the same principles apply to "a calm mind." If you are mentally agitated, nervous, neurotic and terrified about making a mistake, then you will not be able to play at your best. Obviously! Unfortunately, all too many music students exhibit all these mental qualities! What brings this about are some of the same things that cause technical problems: impatience and trying too hard.
This is understandable because the discipline of classical music is pretty stringent. You read things like professional guitarists saying you need to be able to play all your repertoire through perfectly ten times in a row before venturing it in public. And you are sitting there thinking, "I don't think I have ever played anything perfectly in my life! Not even once!" Dude, I hear ya! Making this demand on yourself in these stark terms is what makes you neurotic. You are basically creating a situation too difficult to cope with. So don't do it.
Here is what you should think: make everything easy. Relax, not just your body, but your mind. You do that by not making impossible demands, but easy ones. Learn a very easy piece and practice it very slowly. Suddenly accuracy is possible. The word "perfection" is so dangerous to music students because they associate it with everything they don't feel capable of doing. But the word "accuracy" may not have the same psychological traps. Be accurate, don't even try to be perfect and pretty soon, you will be just where you want to be.
Recording is one of those things that can lead to neurosis because, at least until you get used to it, it seems to exaggerate every tiny flaw in your playing. I used to avoid recording myself until I had to for this very reason. But then I came to terms with it, got used to it, and it has become a very useful tool.
In general beware of all advice that seems to be too "psychological" because worrying about being neurotic is what makes you neurotic--for example. Just have a calm mind and don't do anything or allow anything to happen that will disturb your calm. If you have to practice slowly to remain calm, then do it.
I'm pretty sure that if you asked two of those gentlemen whose photos are above, not Pete Townshend, but the other guys, John Williams and Manuel Barrueco, they would say the same thing.
UPDATE: I just recalled one of those misunderstandings that students tend to have. It relates to causality. When you are starting out, you see one of these great masters play and you think, "wow, he's so calm--it must be because he is such a master" i.e. he is calm because he plays perfectly. But the causality is quite the opposite: he plays so well because he is calm, not the other way around!