Allowing employees to use their time off may result in happy, more productive employees who put forth more discretionary effort. And a final word on one of my personal pet peeves: if someone takes half a day off - don't send them off with a sarcastic comment like "You must've had a rough day today."
The candidates you want have options, including the job they already hold. It's hard enough to convince them to leave that job and join your company. Treating them like a number doesn't help the situation. Dragging them through a long, bureaucratic hiring process is like putting a customer on hold for 45 minutes.