As a music student at a conservatory, I believe this is true in that setting as well! (Though I would say feel is more important than intonation, as long as a baseline level of intonation is in place, and of course ideally you have both)
It's of course my own interpretation of what's important about music, but I've found that an arrangement sounds better if everyone's in tune and playing robotically than if everyone's out of tune and playing with a lot of passion. You kind of said it with "as long as a baseline level of intonation is in place"; if someone's playing way out of tune but with a lot of feel and passion... you get folk punk and "gifted kid" middle school folk ensembles.