I've seen people that have solid proven development experience of more than a decade, investing time preparing for coding interviews(!). And, in a perverse way, it makes sense because they know that they are going to be asked to do something their experience has little to do with and most likely forgotten after university.
I've had to do that. Doesn't matter that I've been lead programmer on multiple projects and lead teams in developing apps that (at the time) the interviewer could download, play around with, and see my name in the credits...
Nope, we aren't even going to ask you anything about that, or let you open up your iPad and show us, here's a whiteboard, start writing up a recursive permutation algorithm (only ever had to do this in programming interviews) because we want to prove you know how to do recursive stuff (and then tell us why you should almost never use recursive solutions in our apps), oh, and how about a red-black tree (algorithms class ran out of time to cover, unneeded since), or how about coding this specific sort (heap, merge, whatever) that you'd almost never use in actuality because there are tried and true libraries that are already more efficient than you'd ever be doing it from scratch?
Ugh. Fine, you can do your test, but please don't ignore my prior experience or act like you haven't even given a cursory glance at my resume, or even worse, make a dismissive comment when I talk about it during the interview. It really is insulting. And yet half the interviews I've been in have been like this.
I always try to do, and (especially at say a Google or Facebook) it always pays off; there's always some long forgotten data structure I need for at least one of the questions.