Tell them they have a billion dollars and they need to invent a pinning, photo, social, whatever site that can scale to everyone on the planet. Then give them a whiteboard. With one question you can determine how they communicate, their thought process, level of creativity, what they know, what they don't know and because it is open ended their nerves will quickly fade away.
The best developers are creative problem solvers not wrote learners.
Rather than a test that doesn't mean anything, you go on an adventure of code/design/architecture and you can see how the developer thinks/organizes and the depth of their knowledge and experience.
Hopefully companies start doing this more.
My take is that it's best to make the 'interview' as close to representative of the actual job as possible. It sounds like you're on the money there.
I'm always wary of 'culture fit' though, it's an umbrella for all the personal biases and ill-informed gut feelings that anyone feels like shoving under it. Do you have an opinion there?
Then, hack on a small project for the hiring startup that would be useful. An internal tool or dashboard. Make it fun.
This isn't school, college, academia. We don't need tests. Companies first and foremost need good culture fits, self-starters, independent, passionate, people. In fact, I'm actually fine with having a (beer || soda) with a candidate, and just talking as a first step.