Food in Thailand is often not that spicy by default. The condiments on the table are what allow everyone to adjust the spiciness to their preferred level. So, I wouldn't say it's necessarily the staff thinking you can't handle it, it might just be how the dishes are always prepared.

As a Thai person, the cooks know that if they have non Thai guests, especially "Farangs", they need to tone down their spicyness. You have to insist them or bring a local to have them make it hot.