As a guy still in school, I would say that more than half of the people in my CS classes are complete dunces. I would think that even by selecting for the degree, you're still faced with the problem of needing people to prove their skills, no? Is a guy who graduated with an almost failing C really better qualified -- at least from a foot-in-the-door perspective-- than a self-taught guy that has the confidence in his skill to ignore the degree requirement and apply anyway?
No. But there's no easy way to tell the difference between "a self-taught guy that has the confidence in his skill to ignore the degree requirement and apply anyway", and an idiot who didn't read the ad properly, and the latter are sadly far more numerous.