That ability is not the same as being good engineer or problem solver. It is pretty much orthogonal. E.g. You can be good and both have it or not have it.
Basically,you test social skill for position that does not necessary requires that skill.
It has more to do with whether you think out loud (which I do and have a bit of advantage in such hiring process) and less to do with overall attitude of perfectionism when giving away finished work. I would not hire such person as consultant or support, but I worked with such people on positions that don't require much speaking with customers and they were great to work with.
Going back to the example of a doubly nested loop to determine if there are any two numbers in an array that sum to zero, it should take at most 1 minute for a smart engineer to figure out that it works. They don't have to speak before they've evaluated whether it works. The metric I use is: how long did they take to get to a solution that works, even if inefficient?