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It should be done at least once in a class. They would have to do the same thing in a scrum meeting in the real workplace explaining what they did the day/night before to a senior dev or a project manager. I quiz my contractors all the time. Drives the contractor PM nuts, but he respects it.
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100%. It's pretty easy to spot students' AI use, but I kinda hate grading based on that subjective feel, so I avoid it as much as I can. Because of that, my implicit AI policy is very permissive.
Most of my students would get absolutely wrecked in any kind of in-person assessment