Personally I've always been as upfront as possible with candidates about the state of things. I've never had a new employee join and be surprised with what they found, and I've never showed a candidate code prior to hiring them.

Sure, there may be very few companies in the world where there is 'secret sauce', but the problem is that they all _think_ they have it. If my GC says I can't share IP without paperwork signed then I can't share it - the reason is not relevant unless I have the power or influence in the organization to change the policy. I'm not getting fired over it and (at least at previous companies) I'd get laughed out of the room for even asking.

I'm an engineer myself. This isn't some kind of game I'm playing to pull one over on poor hapless souls - we can argue what ought to be until the cows come home but the reality is that the vast majority of hiring managers have their hands tied by company policy.