It's much less stressful and takes much less time to give me a basic to intermediate coding problem to solve on my own with a pre-set number of days/hours to work on it.
Also, if you give the same assignment to multiple candidates, you'll get a better sense of how people use different approaches to solving a problem. You can still use discussions around side-projects to complement the process, but having a standard approach for all candidates is helpful.
Except it never means this. It's always "and" and not "instead of". Many companies do these irritating programming challenges now, and then when you pass them, will still bring you in for the standard Whiteboard Hazing sessions.
But if you ask them to do a 30-minute coding task, that suddenly becomes a total disrespect of their time.