Good call. The sheer idiocy of expecting people to show off their mad hacking skills in such an obviously crippled environment is just... breathtaking. Especially when the cost of renting a session on one of the services that does offer a full-featured IDE (with vi and emacs modes) is close to zero.

But given that it's most likely the result of junior hiring managers giving marching orders to junior engineers (i.e. the people conducting the screening) who just don't know any better than to say "no" to such a silly and insulting request to make of incoming candidates... the depth and reach of this annoying fad becomes less surprising.