I'm confused. On the one hand you say that the hiring practices are obnoxious, but then you agree that the only way to verify someone can code is to have them "actually pump out some code".
I now have two steps before an in-office interview: an online programming test, followed by a screen-share coding test. When I just did the screen-share test, I can't tell you how many people claimed to be java programmers and their IDE was eclipse, and then they didn't know how to start coding or run a program. "I know junit", ok, write a junit test and run it in eclipse: deer in headlights. Such a huge waste of my time. So now we do an online programming test, and many applicants fail to write code that compiles, let alone passes the test.
There are good applicants out there. It seems like they are vastly outnumbered by frauds. I have no other way to describe these people that cannot program, and just show up with a bullshit resume hoping for a paycheck. Before I was responsible for hiring, a man was hired on our team who could not program, despite a resume showing years of java work. Now he gets to go to the next place with our company on his resume. These frauds are hindering us finding the genuinely talented.