Today’s first year undergraduate is roughly as literate as a sixth grader was a century ago. College was never meant to be a mass remedial education program and by attempting to be one it’s failing at its core mission.
All this nannyware of various sorts is just more evidence, proof even, of how few of those students should even be there.
Not really in my experience. That's how final PhD examinations are typically done. Outside of that, it's pretty rare. That said, PhD students are also regularly interacting with faculty members and discussing their work so it would be difficult to get by without actually knowing things.