As Gail and Matt already pointed out, physical file fragmentation and index fragmentation are two different things.
Is fragmentation seriously no longer a problem with SANs?
Files are fragmented by definition on a SAN implementing striping. On the other hand, enteprise level SANs have built-in caching features that highly mitigate fragmentation performance issues.
Linchi Shea has a good blog series on SAN fragmentation here.
-- Gianluca Sartori