> and in most cases programmers who are comfortable with the command line version are also the ones who are better at writing code
These two statements indicate to me that you are ineffective at communicating what skills you are looking for in a programmer.
The reason they are coding a sorting algorithm is that you're interviewing a programmer for a programming position. The assumption is that they are being tested on the knowledge in that domain, which includes sorting algorithms.
If I answered the exact same question by putting the file lines in a data structure and calling Sort() in someone else's interview, I might be thrown out for not giving them the actual algorithm that Sort() implements.
Or maybe you just want people calling system()/exec()/execvp() or whatever. I dunno.