On one hand this seems pretty reasonable. I'm assuming you're going to be out between 20 and 40k if you use a recruiter in the bay area. You can play a lot of games like this if you have 20 to 40k. Reading between the lines it seems like they also select for single/childless people, unless you really expect people to show up with their spouse and children.
Stepping back a moment, I'm stunned and thankful to be an engineer in an environment where lots of people are willing to throw stuff like this at me in return for the possibility I might deign to work with them. Sure beats spamming dozens of companies with resumes and beating my way through hr.
I'm thankful and I'm not. On one hand, it's nice to know you're in-demand and can easily earn income. On the other hand, as a working developer, the subtext of a lot of this stuff is frankly pretty offensive.
"Let's throw some stupid, token perks at these developers who don't know how to negotiate for salary so they'll come build my dream!" How about, pay people commensurate with the value they create for your organization and/or demand (in cash, or if you're cash-poor, equity), and stop playing stupid games -- you'll have plenty of candidates.
I like the idea of moving some of the risk from the job-seeker to the job-offerer. If the developer gets a hotel room for a week in SF and the trip ends up not resulting in a job, he or she is out hundreds of dollars, and that risk might discourage people from visiting from outside of the bay area. There might be a huge number of developers right on the edge where it doesn't quite make sense for them to take a trip to SF, but free room and board would bring them in. Employers are already throwing tens of thousands per employee at recruiting, so this little investment might make a huge difference compared to other recruiting tactics.
Stepping back a moment, I'm stunned and thankful to be an engineer in an environment where lots of people are willing to throw stuff like this at me in return for the possibility I might deign to work with them. Sure beats spamming dozens of companies with resumes and beating my way through hr.