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What if it's paid? We pay people for interview projects where they have full access to our team and resources. This helps us gain an understanding of how they interact as well as their technical chops, produces value from most candidates, and makes sure the candidate is being compensated for using up their free time to work on this.

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You're still using their free time even if they're being compensated. In addition, there's a decent chance that, assuming you're in the same field as a current employer, they may be violating their employment contract by taking money from you. I know people will argue this isn't a big deal and "who will know?" but it seems an awkward situation to create.

This is better for sure, but if you're trying to get someone really good to leave their current job (hint: They always have a job) it's as much the time as money so it still doesn't work well

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