There's a tendency in IT circles to use questions that have a more or less definite answer. Yes, it is important to assess a candidate's skills, but from over here in the cheap seats of the peanut gallery, I find it far more important to include much more open-ended questions.
For example, one of the best interview questions I ever heard was: "If I asked you to make me a peanut butter and jelly sandwich, what would you do?" You can tell A LOT about a person by how they answer that.
When I was taking a course to get my A+/Network+ certifications, our instructor related his interview experience for the technical school. Part of the interview was to give a five-minute lesson on how to use a mouse to several of the current staff. Of course, the staff would do things like using the mouse backwards, picking the mouse straight up in the air whenever someone said, "Move the mouse up" and so on.
As a final example, I read about a man who would take candidates for senior positions out for breakfast. He said he would never hire anyone who put salt on their food before tasting it because he felt it indicated they made decisions without assessing a situation first.
In my mind, you get more value out of questions that reveal a person's work habits, how think and how they learn. Frankly, I'd rather hire someone with fair-to-middlin' tech skills who has great personal or customer service skills and shows a demonstrated willingness to learn. I'll teach them the tech. Beyond just asking how a candidate would handle a given situation with, say, a networking problem, I would also ask questions such as;
-How did you learn networking? School? Book? Internet? Good old-fashioned hacking?
-What part of networking is the most difficult for you? The easiest? Why?
-Of all the computer skills out there, which one do you want to learn that you currently know little to nothing about? Is there something you're learning about right now?
When it comes to assessing skills, rather than just giving a technical "fizzbuzz" test, review the answers with the candidate and ask them WHY they took a specific approach or gave a certain answer. If they have no clue, ask them how they might go about coming up with a solution.
You may also want to think about asking questions such as, "Do you work better in the morning or evening?" or "If you did get the job, tell me how to manage you."
The point I am belaboring is that technical assessments are certainly a necessary part of an interview process, but in my mind they are only a part, and in most cases should be a starting point.
Just my $0.02 from over here in the cheap seats of the peanut gallery - please adjust for inflation and/or your local currency.