It's not just a time issue for the interviewee; the interviewer then needs to spend extra time checking the quality of the work, requiring extra technical expertise.
Awesome idea; just not feasible in many situations.
I don't really agree. It's more that innovation isn't publicized and talked about as much as companies that are looking to score big. It also takes longer to mold innovation into something that can be sold; in the end, we still need to eat.
Also, why America? How is it different in other countries? Genuinely curious.