Yeah - I have come across this on a number of occasions. The CTO of am company I was contracting for once described it to me as "The Technical Ghetto" - he had been pulled in of CTO of the division from CEO of another division.
Basically, tech skills are in high enough demand that good tech people are too valuable to be allowed into management
A very cynical but funny take on this premise can be had in Venkatesh Rao's series of essays ["The Gervais Principle"][0]. He posits three groups: Sociopaths, Losers, and The Clueless. Here the Sociopaths are the intelligent but ruthless C-levels who build and oversee organizations. The Losers are the ones who actually get the day-to-day work done, at the expense of their own progress in life. And the Clueless are moved "up" from the ranks of the Losers by Sociopaths into middle management, where they insulate the two productive groups from each other.
Basically, tech skills are in high enough demand that good tech people are too valuable to be allowed into management