I've been around that sort of text long enough to know exactly what I'm seeing and respond accordingly. They might be looking at it like that.
The "25 horses" question is much less useful, but gives you an idea of how the candidate approaches a problem. Getting the right answer is great, but seeing that someone understands the concept of combinatorics or some kind of process of elimination is much more valuable.
You really want a technical question so that you can see someone CODE the solution, or better yet, give them some task to do that's apropos - that part of the argument is fair. In past companies we've done all three, weeding out terrible candidates with the coding questions, weeding out mediocre candidates with thought-process questions, and selecting only the best with a programming simulation.
(echo 'ZW5naW5lZXJpbmdAcm9ja3RoZXBvc3QuY29t' | base64 -D if you're curious, and the answer to the horse problem is 7 IIRC)
PS: I am treating this as a real world trick question, if your talking about a virtual world where the only information is a horses rank then yea you would need a 7th race with 5 horses assuming no ties.