Yeah but then inevitably the company starts grading on a curve. Did the dev nail every single possible mistake or bug? Did they add any extra flourishes? So you're not just testing for basic competence anymore. You're testing for devs who are really good at timed coding challenges - just like with challenges where it's tough to get the right answer in the allotted time.

Companies don't get excited about a dev who just passes. Even though that dev might be by far the best candidate - they just need a few days to chew on various architectures - or they take the test literally and don't add bells and whistles. Etc.

Companies get excited about a dev who aces it with flying colors.