That makes sense, but doesn't address the OP's other major point: how do you deal with people who either 1) are contractually prohibited from freelancing for yo

That makes sense, but doesn't address the OP's other major point: how do you deal with people who either 1) are contractually prohibited from freelancing for you or 2) are too busy with their day job to be able to give an honest effort? Have you ever had a candidate that you suspected would be a good hire but was in that situation? How did you deal with it?