If I'm unemployed and I have bills to pay, a paid probation period is the better option - even if I get fired after 90 days, that's still 3 months' salary. On the other hand, if I already have a job, joining another company is a big risk - I'm giving up a comfortable position for a job I might lose in 90 days if it doesn't work out - maybe I'll be in over my head, maybe I don't get along with the manager or the team, whatever. A long interview process gives me plenty of opportunity to gauge my prospective employers and back out at any point.
Also onboarding is expensive: even an experienced developer who has all the skills you need still has to learn your codebase, processes, business logic etc. while drawing a salary, and all that goes to waste if they leave before they can start becoming a net positive to your company.
Also, even with a probation period, a bad hire can damage morale and waste a lot of the team’s time.
I’ve only seen this approach fail once, and it wasn’t that big a deal, because very little time was sunk in to hiring the employee that had to be let go. At most a day or two was lost on-boarding.
Probation in Germany goes both ways. Recently I worked there at a (small end of medium sized) company where work and pay was just so-so (nice, smart colleagues though). Then in a meeting the superior or my superior mentioned that there was some redundancy. Aha, I thought, I take that as a sign and promptly resigned some two weeks before the end of the probation period. They still expected me to come in 'til the last day, which I didn't mind too much, but still found a bit silly, since both parties agreed about the separation (also given the finite funds of that company).
Laws that benefit the company, such as "right to work", mean that employers will often win lawsuits from former employees for things like wrongful termination suits, however companies would prefer to not be sued at all- even if they have a strong case. Court is expensive and a hassle.
That said, I did some moonlighting work for an employment law firm, and they say that they take less than 5% of the prospective clients who contact them, because they (and most law firms who only get paid if the client wins) want to be as sure as possible they will win the case. Of course if the prospective client were willing to pay up-front regardless of the case outcome, I'm sure most law firms would oblige. In such cases, I expect the former employers like to settle out of court to save time and money, even if the odds are good that they'd win in court.
If among promising looking and speaking candidates, few are actually good, then what will the current employees think about people getting hired, fired, replaced a lot