Frankly that seems more like a google search algorithm failure. I think the idea that people shouldn't produce content because you don't want to see it listed is more than a little silly.
I've experienced this a number of times and it's mostly frustrating. Recently though, we've had two customers come back to us after their "preferred" vendor failed to execute. So even if they have a competitor in mind, it's sometimes good to get in front of them regardless.
I'd honestly be really interested in seeing references. These are some strong statements, I'm searching for research on what you're claiming, but so far it does not appear to agree.
I love digital explorations like this, but the step length of these google maps style walkthroughs drive me insane. I often want to look at the detail of something that happens to be in between two steps, and it's just not possible.
As an interviewer I'm going to give this method a try. I will also add a step to our hiring process where we solicit opinions from the team about how well they felt the interviewee did at communicating during the exercise, as this is a major part of any real world work.