but a lot of people similar to Candidate A who can actually code are being presented with questions about linked lists and similar structures no-one who has written code for years would remember, let alone use in their daily work lives.
Your reference to "remembering" is entirely irrelevant. What is relevant here is whether the candidate can reason through the problem - and more power to the candidate if s/he's been out of school for N years. What I strive for with technical questions is not to find out how well the candidate remembers their Knuth( although finding someone who actually read Knuth is nice ) - it is to determine how well they think through problems. And with no offense intended, if you can't at the very least come up with some ~3N complexity stupid-but-it-works stack-based solution to the problem of reversing a linked list, you probably shouldn't be a professional developer.