I've been on both sides of this equation.
When I was doing the hiring, I was gobsmacked at how many rubbish CVs we received. Bad spelling, appalling grammar (I don't mean an incorrect use of a semi colon, I mean an inability to use a capital letter correctly), completely irrelevant experience/skillset compared to the job...you name it, I weeded it out. And, when we did shortlist four candidates, one rang up about an hour before the interview to say he wanted about 30% more money than was on offer. When I told him no, he huffily announced that he didn't see the point in coming to the interview. Frankly I agreed with him - he was a pain in the arse and I'd not even met him yet.
However, having been the person looking for a job recently, I was equally gobsmacked at how many employers want the moon on a stick. Applications not looked at unless there was a custom cover letter detailing why you were interested in the job, why your skills were relevant and what you would bring to them as an employee. And that was before the enormous 8-section application forms that required an extensive statement as to how you met every single one of their criteria (all 40 of them) and - again - how your skills were relevant, what you'd bring as an employee, blah, blah, blah. To the PP who asked how anyone could spend 5 hours on a job application, THIS is how. Some of those statements took hours to write in order to make something coherent, readable and that covered the job spec. There were some jobs where a big personal statement was appropriate, but there were oh so many jobs where the recruiter seemed to be on a power-trip, where they thought the job they were offering was so special that they were entitled to demand you jumped through every hoop just to get them to read your cv (see also: basic admin jobs requiring a 2:1 as an entry qualification).
And then, after all of that, most of the time I'd not even get an interview because - despite all my so-called transferable skills - unless you've got the actual experience to walk into a job and pick it up on Day 1 as if you've been there a decade, a lot of employers won't even consider you because a) they don't have the skills themselves to work out what skills they need in their employees, they can only tick a box against "Done it already", and b) they can't be bothered to train anyone up.
Thankfully I found an employer who recognised my skills - even though I didn't have half the experience they wanted - and let me learn. Without wanting to sound too up my own arse, it turns out I'm bloody good at what I do but most employers wouldn't even give me a second glance.
I'd rather have a smear test while having my eyeballs gouged out than job hunt ever again.