That seems normal for an interview problem. They put you in front of some already-written code and you have to fix a bug or implement a feature. I've done tons of those in live interviews. So that part didn't bother me. It's mostly the rather large effort cost in the case where the person is a job applicant, vs an unknown and maybe quite low chance of getting hired.

With a live interview, you get past a phone screening, and now the company is investing significant resources in the day or so of engineering time it takes to have people interview you. They won't do that unless they have a serious level of interest in you. The take-home means no investment for the company so there's a huge imbalance.

There's another thread about this article, which explains an analogous situation about being asked to read AI slop: https://zanlib.dev/blog/reliable-signals-of-honest-intent/