Earlier quoted context omitted.
Could you explain why it scales worse than current typical interview sessions?
Because a candidate can grind leetcode and prepare for a huge number of companies. On the other hand, something like a homework assignment is typically good for a single company, and if you fail, it's time and effort and emotional energy down the toilet.
I get that it's not very real-world representative, and that's why homework is used instead by some companies.
Maybe the answer is to give the applicant a choice? Either be prepared to convince me you know what you claim, or demonstrate it with a take-home problem.
Personally, I'd prefer a day of in-person-pair programming as part of the interview. I'd get a better feel for the team and their workflows. If it's a total horror show, it's good to know up front :)