I agree with this view. The statement "you are not that smart" is true and blunt in the case of everyone without exception, but it is useless. A gentle feedback sugarcoating some of the flaws might help the listener.
It's generally not helpful to say "Your plan won't work because of A, B and C" and then leave it at that. Are you trying to find problems or to help?
Don't get trapped into thinking that pointing problems is helping. It's good in school when you're a teacher, but almost nowhere else.