The issue I take with this opinion as noted above, it selects for people who have available time. I am genuinely interested in programming, but I come home and spend time with my 4 month old son.

I think the "more than just a 9-5" idea is a toxic pattern which has been championed by the privileged. In short, by wanting something like this, you risk selecting for a fairly homogenous set of people.

I think you can write a good coding challenge which doesn't look like all the others (the socialite example in Takehome.io is particularly good because it scales with skill level – it's not a pass/fail, but a spectrum from just making it work, to showing you have thought about and dealt with an array of odd things that might crop up).