https://github.com/poteto/hiring-without-whiteboards has a list of companies who don't participate in this particular flavor of shenanigans.
Understanding CS teaches a lot about seeing abstractions and choosing between different levels of abstraction and problem solving. It greatly helps modelling business problems as software. I don't think it is important as an end in itself.
And I'd argue programming is closer to building an airplane than it is to the almost innate skill of jumping.
At my previous company (not robotics) I conducted a lot of interviews and I think we hit a good balance between algorithmic problems and design/architecture ones. Then again, even algorithms questions can be formulated as real world problems - it help weeding out obvious brain teasers. We also didn't asks people to write code on the whiteboard - there was a separate coding exercise.
I don't even think that asking about algorithms is such a bad thing if you do it correctly and it's not all what you do. But perhaps too many people just throw a problem at the interviewee without and help or guidance.
Overall, conducting a good interview is hard and it is not a primary job of most engineers who do it, so it's not surprising there are quite a few bad interviewers out there.
Now, most good software engineers would probably not be very good at competitions, because competitions require certain specific skills that are not useful outside of competitions. And that's why good interviews don't put too much weight on algorithmic skills.