Is Zahir and Batin equivalent to Form and Essence? Can the Batin have physical form?

Zahir and Batin are NOT the same as Form and Essence. Zahir and Batin can BOTH have a physical form. A ritual can be batini and still have form. For example, Namaz is Zahir and the Dawah (hierarchy of individuals who call people towards the Truth) is its ta'wil and batin. Both Namaz and da'wah have physical form, but Dawah is batin, not zahir.

Nasir Khusraw, the 11th century Ismaili philosopher, poet, and traveler, wrote that the Zahir of the Shariah like Namaz, Hajj, Sawm, Wudu, etc. are not necessary for human wellbeing. They are only important because of their Batin. The Batin does not need the Zahir to exist. The Zahir needs the Batin.

He also explains, that the Zahir of Wudu is to wash parts of body. He says the batin of Wudu is to pledge Bay'ah to the Imam. Now here the batin of Wudu still consists of a form. Whenever you perform the Bay'ah ritual, that is still a form and yet it is batin.

In Ismaili history we have had Imams abolish the zahir of the Shariah and only the batin of the Shariah remained. Such is the case today. The current Ismaili Imam in his guidance to the community has explained that "Our interpretation of Islam is ESOTERIC, it is NOT EXOTERIC."