It's not artificial: the company has a day of my time. I have a day of their time. We both want me to meet several people on the team to see if it's a good fit. Because of the constraint, we keep it to relatively simple discussions around toy problems that can be solved in an hour.
Yes, it is artificial. Everything about a live coding interview is artificial. Code doesn't get written in 1 hour blocks while someone's watching over one's shoulder, all the while asking questions to interrupt one's thought process, in any company I've ever worked for.
Like I said, this is literally a thing I do all the time. I have standing 1 hour blocks for each of my team members every week and it's not uncommon for us to build out the skeleton of a problem solution together. I literally did what you said on Wednesday for someone for a gitlab change because I don't expect they know how secret injection works, but I want them to know. And absolutely I've encouraged them to ask questions, and I ask them questions to check their understanding.
Like I said, that's not the same. It's not comparable in terms of stakes, or expected outputs. You're not addressing the issue.