> or it's an indicator that they get flustered coding in front of people. I definitely underperform when pair coding, coding on a whiteboard instead of a computer I'm familiar with? Probably not my best work.

One needs to evaluate people. I would prefer to evaluate people using a metric close to what is required in the job -- coding.

If people have issues that they can not be evaluated properly, then what I am supposed to do? Just hire anyone no matter how they do?

Of course coding isn't the only metric but it is one of a couple. If you write an algorithm that has indexing errors or no stopping condition or just does't work, it isn't a good thing. I do rely on coding on whiteboards or paper a lot more when it is someone new in their career and do not have many past accomplishments to point to.