I would think the idea of C2H is instead of having an intense interview you have a performance review and talk about how you work together. If you still have to pass a high pressure interview attempt to filter you out after working with a team for 3 months there’s no advantage to C2H.
If you /didn't/ have to pass through the same meatgrinder that every other employee did there's a reasonable argument that it could be seen as an opportunity for favoritism. But that sort of ignores that if an interviewer wants an interview to go well (because they feel more empathy for one interviewee over another for instance...) it tends to go better. We like to pretend that "a question is a question" but we're just testing the person's state of mind. I've had interview questions I've answered >10 times and drawn complete blanks because I'm trapped in a tiny room with a person with an inflated title and ego, and their shadow who is intently staring at every movement I make.
Who cares about favoritism vis-à-vis "the meat grinder," if you're just trying to hire good employees?
People who paid a lot of money to get their education and bonafides. Or antifavoritism crusaders that like to tell themselves they can make a biasless interview process.