Well that was certainly the case with whiteboard interviewing; it's a terrible way to evaluate a potential hire.
But someone (probably Microsoft) started interviewing this way and everyone copied them.
When I interviewed people I would just talk to them. We'd discuss approaches to problem-solving; if the interviewee said that however the team did design, formatting, whatever was how he would do it, he got a thumbs down, even if he was, no, especially if he was knowledgeable and experienced. On the other hand a candidate who has a lot less experience but thinks about design, who doesn't simply obey compulsions like optimization, he has potential and gets a thumbs up.
A test would give opposite results.