Unless I was hiring a professional whiteboard coder, I would find another method.
I do interviews, I care less about the right answer than I do about the problem solving approach. I interview electrical engineers and I make them do simple transistor problems. If someone gave up and said that they couldn't do it without some sort of SPICE program, I'd cut the interview pretty short. But if the fundamentals are there, even if they don't remember something stupid, knowing how they approach a problem and if they know how to ask for help is more important.
Every time someone says "I didn't get the job b/c I couldn't do a linked list on the whiteboard." I'm fairly certain it was more than that.
Is it that you just don't like the kind of problems that are being asked (fundamental computer science) and would rather see more real-world problems? Or do you genuinely think the wide, stubby pen and vertical orientation impairs some people's coding ability? Just to note, I can see the performance aspect of the whiteboard is stressful, but coding on a machine with everyone looking at you is stressful too.