This is incredibly true. I once turned 60kLoC of classic ASP in VBScript into about 20kLoC of python/django including templates. And added a bunch of features that would have been impossible on the old code-base. It turned the job from hellish (features were impossible to add) to very nearly boring (there wasn't much to do anymore). So with this newfound freedom I built some machines to automate the data entry and on…
I'm pretty happy that I did what I did in school, but I wish that people didn't rely on the whiteboard situation as much. If I can talk about what I did to find the edges and corners of a piece of mail in a picture, and how I used that I can rotate the image to be square and then crop the image so that all you see is the letter and not the background, perhaps my ability to do some kind of whiteboard coding exercise isn't terribly relevant. The odds that I can answer questions about how I developed such an algorithm while still not being able to actually write code are pretty small.
You're hiring me to solve business problems and last I checked FizzBuzz or reversing a singly-linked-list aren't business problems. End Rant.