In university, we learned the concepts. We applied the concepts in internships and learned how to do things hands-on. When it comes to applying for jobs, internship experience is considered more important than academic coursework. So this is kind of parallel to how 'real world' experience developed from personal projects is more important than academic training in software.
So in this sense, this kind of reinforces what the original poster said. This kind of hands-on experience is important, and there are different ways of demonstrating it in different fields.
You are right though, no one is expected to do Quickbooks on the weekend. You have to realize that there aren't a ton of professional fields where people do what they do professionally as a hobby.