Regarding #2, I believe your observations and concerns are correct and valid. However, in these situations where the candidate spills his technical heart out,

Regarding #2, I believe your observations and concerns are correct and valid. However, in these situations where the candidate spills his technical heart out, you really start to see the difference between good candidates and bad candidates. Good candidates just have a deep sense of the problem space, can enumerate issues, document such things, etc.