I came across it when studying computer science 20 years ago, yes. Heard about it after that but never directly needed the knowledge.

I'm sure it's used under the hood in a lot of code I write and have written but so is XOR, manual memory management and a bunch of other lower level implementations that I don't need to spend time on when developing on a higher abstraction level.

Not sure why you would expect all programmers to know about binary trees specifically.

Binary trees are the simplest kind of nontrivial tree, and trees are used extensively in programming. Most computer problems are solved using trees of one kind or another.

If you've never needed to know it, what is its value for finding a good candidate? A lot of these questions are basically testing whether you did a CS degree. If you're self taught, you might be just as good a coder, but have never had reason to learn what a binary tree is or how to implement quicksort, or whatever similar puzzle.

It's a nice way to filter out people who can code and basically do the job, but didn't have the financial resources to get a CS education, and weren't lucky enough when researching to see that his is an interview question. Although at least they'll know for next time.