Like I mentioned in my comments to your question, the idea of demanding, meaning ordering people to say the phrase, יחי אדונינו מורינו ורבינו מלך המשיח is contrary to the general concept of Kingship מלכות and the mitzvah of Appointing a King.
That like the Rebbe taught over many years quoting from the Tzemach Tzedek in Sefer Derech Mitzvotecha, the appointment of someone as King is strictly a voluntary act by the people and cannot be demanded. To emphasize, it is the choice of each individual and is not something forced upon the people.
For context, think about the analogy of what is called the period of Nasirah that occurs on Erev Rosh HaShanah and the night of Rosh HaShanah before we blow shofar in the morning.
We accept G-d as our King through the blowing of the Shofar on Rosh HaShanah in the morning. Then, after accepting the Kingship of Heaven, the HaNetanah Tokef is recited during Musaf, recalling the judgement by the re-established King of the Universe of each and every created thing, each according to its unique circumstance.
Making a demand of the people by force is the act of a Moshel המושל or Rodan הרודן, something akin to a Dictator.
That said, you ask if the Rebbe wanted this phrase to be said. The simple answer is yes. There is a long history of this practice within Chabad like, for example the photo from the book titled בנאות דשא published by Kehot recording the Rebbe's trip to Camp Emunah and Camp Gan Yisroel in the year 1956. The banner placed over the entrance to the camp read: יחי אדונינו מורינו ורבינו מלך המשיח. In other words, this practice was known already when the Rebbe first filled the place of his father-in-law.
Concerning the importance and significance of saying exactly this phrase voluntarily, an importance both to the people themselves and to the leader, is something addressed by the Rebbe directly. It is not an innovation of the Rebbe, but consistent with the teachings of his predecessors. One of the primary sources for this comes from the talk of the Rebbe from 2 Nisan, 5748. (March 20, 1988)
In this talk, the Rebbe is speaking about (in his words) the Nasi of our generation, meaning the Nasi of the Rebbe’s generation, (so it is pertaining to his father-in-law, the previous Lubavitcher Rebbe (who said publicly that during his lifetime that we had entered the epoch called עקבתא דמשיחא Heels of Moshiach),) 38 years after his ascent from our world. But as the Rebbe emphasizes, it also pertains to Melech HaMoshiach.
So in answer to one detail of your question, it is applicable whether the individual is standing before you, soul dressed in a body or not.
The relevant section begins on page 496, paragraph 4 through page 498, paragraph 6.
I am providing a link to the talk as it appears in Torat Menachem for those who wish to read the Hebrew. A free translation into English follows:
...that these concepts are clarified in the Chassidic discourses and a portion of them is collected in the book “Collected Discourses of the Tzemach Tzedek (that among them are also included discourses of the Mitteler Rebbe and the Alter Rebbe), and they are also the foundation to the discourses of our Rebbes, our Nasi’im who followed afterward, up to and including my honored and holy teacher and father-in-law, our lord, master and Rebbe, Nasi of our generation (meaning the generation of the current Rebbe who is speaking and all those included in his generation), that through careful review in these places clarification will be added in regard to what is spoken about above on the matter of the particular distinction of this year (1988) in regard to the aspect of “Give to a Wise Sage and he will become even wiser.”
[Translator’s note: It should be pointed out that the two terms, Rebbe רבי and Nasi נשיא are not random, honorific expressions. They are specific abbreviations with precise intended meaning. Rebbe means: Head of the Children of Israel (ראש בני ישראל). Nasi means: Spark of our Patriarch, Yaacov (נצוץ של יעקב אבינו). These terms are applied and relate to stages of spiritual growth and maturity in a given individual. To put this in the context and language of the Mishnah (see for example Horayot 13a), it is the distinction between the Amarkol אמרכל and the Nasi associated with the Monarchy נשיא like Rambam states below. It should be noted that in the written Torah, the Amarkol is related to the Nasi of each tribe, while Moshe Rabbeinu, who is the idea of the Monarch over the whole nation, is referred to as Nasi.
In keeping with what the Rebbe says about his father-in-law, the previous Rebbe, the expression our lord, our master, our teacher (אדונינו מורינו ורבינו) is associated with Nasi. And in that context, the words of Rambam from Mishneh Torah, Hilchot Shegagot, chapter 15, law 6 are relevant.
What is the connotation of the term nasi used in the Torah? A king who is not under the jurisdiction of any other man in Israel. There is no one superior to him in his sovereignty except, G-d, his L-rd.
Similarly, a third term will shortly be introduced of King מלך which is an abbreviation for Brain (מוח), Heart (לב) Liver (כבד). That the Brain is the seat of the intellect and also the central junction through which all neural and lymphatic connections to the rest of the body pass. The Heart is the seat of character traits, emotion and temperament. It is also the central junction through which blood and all that it carries, nutrition, hormones, oxygen and electrolytes are pumped to the rest of the body. Finally, the Liver is the seat of the process of Tikkun, Refinement. It is the central junction of both the Endocrine (hormones) and Gastrointestinal (digestion) systems and is essential to the production of Bile.
It is in this sense, that Rambam states (Mishneh Torah, Hilchot Melachim 3:6) that the King is the heart of the entire nation. The life, health and growth of every aspect of the entire nation is dependant upon its connection with the King and vis-versa.]
- And it is necessary to add in regard to all that was mentioned above – in greater depth.
And with the introduction, in regard to the relationship between the people (the nation, meaning the Kings subjects) to the Nasi and King – 2 aspects are:
On one hand – a movement of elevation and separation/distinction, from his shoulders and above, he is higher than the people (a reference to the paradigm for Kingship established with the first King of Israel, Saul, who was head and shoulders taller than his countrymen), People specifically, the term עם (people) also has a connotation linguistically in the sense of an inverse relationship (עוממות), that they (the people) are separate, strange and distant from the level of the King. And like is emphasized in regard to the concept of Fear and nullification of self-awareness (when in the presence of the King) – You will surely place above yourself, a King, that Awe of him is upon you.
And on the other hand – Ultimate closeness, like it says, that the King is the heart of the entire congregation of Israel, and there is no greater closeness than the closeness of the heart to the limbs of the body. Like is said, that the blood that is in the heart itself is continuously found in all (every part of) the limbs. The circulation of the vitality (the life force) is from the heart to every aspect of each of the limbs...like its continuous circulation throughout the (hearts) circulatory system...(that) every aspect of all the limbs are tied together and receive their life force from the heart.
And more than this:
The closeness that is between the King and the people is not only in regard to the entire nation drawing the life force, that they receive their vitality from the King, but conversely – the existence of the King is dependant upon the people, “There is no King without a people.” That is to say, even though they are called “People” in the sense of having an inverse relationship...distant from the level of the King, together with this (and on the contrary – in this context) they effect the Monarchy – the Monarch/the King.
And like is emphasized in regard to the coronation/the crowning of the King – the people declare, “Long live the King.” (like we find also in regard to the Monarchy of the House of David), [Translators note: The Rebbe emphasizes that the different details between David and his son Shlomo should be noted.] That through this declaration is also emphasized that the effect of the people impacts the lifestyle of the King, a Kingly life (and in regard to this, a successful King...that the prayer is for the Kings life and success.) [Translators Note: This is emphasizing the required detail for success found in Mishneh Torah, Hilchot Melachim 11:4]
- According to this, it will also be understood, in our opinion — the 68th year of the Nasiyut of our generations Nasi: In addition to what is said above pertaining to the increase in regard to the concept of life (each year, and how much more so in this particular year, whose indicative sign is the gematria of the word life (חיים) 68.) for the members of this generation via the generations Nasi — The members of this generation effect an increase in the concept of life by the generations Nasi, like is said above in regard to the concept of declaring, “Long live the King.”
And in plain language:
After there has been a completion of 68 years to his Nasiyut (his effect and his work) that of our generations Nasi — there needs to be a primary increase in regard to the concept of life (also) in regard to the effect of the people, that they declare “Long live the King!” That the intended content of this declaration is — that the time of “Sleepers in the dust, arise and sing!” has already arrived. — including my honorable and holy teacher and father-in-law, our lord, master and Rebbe, our generations Nasi and including, “arise and sing, David, King Moshiach! [Translators note: This follows Sukkah 52b]
And this is also in regard to the commotion we made during the period known as “the Heels of Moshiach” concerning the need to declare, עד מתי “Until when!” That through this we drew the redemption closer and hastened it. — That there needed to be, in addition to watching for the redemption [Translators Note: like the teaching of the Chofetz Chaim, צפית לישועה], requesting and seeking the redemption (that our righteous Moshiach will come in effect literally (אנו רוצים משיח אחשיו), in a way of seeing (with our physical eyes and to point) with our finger (הנה זה בא) and saying, (Here!) “This one!”, Behold, King Moshiach, flesh and blood, according to the halachic decision of the Rambam, “A King will arise from the house of David, toiling constantly in Torah and engaging in Mitzvot, like David, his ancestor, according to the written and oral Torah, and will encourage all Israel to follow it and to reinforce its details, and will engage in G-d’s battles. Take note, this (one) is presumed to be Moshiach. And he will gather the dispersed of Israel. There is, in regard to this declaration, also an intention of the concept of coronation/crowning — “Long live the King!”, That through this (act) we effect the coming of David King Moshiach.
- And it is necessary to add, that by Melech HaMoshiach, his connection/relationship to each and every individual from Israel is emphasized even more (more even than that every King is “the Heart of the entire Community of Israel) — That therefore, it is within the power and capability of every single individual of Israel to effect the concept of “Long live the King!” (to increase his life, vitality and to make him successful!:
On the posuk, “A star will step forth from Yaacov’ we find two explanations from our Sages, whose memory is for a blessing:
(1) “A star” refers to each and every individual from Israel.,
(2) “A star” refers to King Moshiach!
And it is clarified in other sources that there is no conflict in regard to this thing. (and on the contrary, these two discourses complement one another) — According to what is known, that each and every individual from Israel has a spark of the soul of Moshiach. It is the aspect (of soul) called the Yechidah that is in the soul of each and every individual. That it is a spark from the inclusive Yechidah of the soul of our righteous Moshiach.
[Translators Note: This is in keeping with the custom to recite on the three Festivals, when opening the Ark before taking out the Sefer Torah, the words from Isaiah 11:2 which says:
וְיִתְקַיֵּם בָּנוּ מִקְרָא שֶׁכָּתוּב וְנָחָה עָלָיו רוּחַ יְהֹוָה רוּחַ חָכְמָה וּבִינָה רוּחַ עֵצָה וּגְבוּרָה רוּחַ דַּעַת וְיִרְאַת יְהֹוָה.
May there be fulfilled with us the verse that reads: “And the spirit of the L-rd will rest upon him— the spirit of wisdom and understanding, the spirit of counsel and might, the spirit of perception and fear of the L-rd.
]
And it is found that in regard to King Moshiach, the connection and relationship to all Israel is emphasized even more. — that the essence of their souls, the aspect of the Yechidah, is a spark from the soul of Moshiach. And therefore, also the concept of “There is no King without a people” (the content and intention of the peoples declaration of “Long Live the King!” has even greater emphasis in regard to King Moshiach. — “A star steps forth from Yaacov”, a star of the whole of Israel, The connection with the revelation of “a star steps forth from Yaacov” that pertains to each and every individual from Israel, causing the revelation of the aspect of the Yechidah of every individual.
And therefore, in the context of the Rebbe’s teaching above concerning the importance of making the declaration of “Long live the King!", even now, it means declaring: יחי אדונינו מורינו ורבינו מלך המשיח לעולם ועד
