> There was discussion about how they thought candidates asking about compensation to be something of a negative signal

It's not an unusual way of thinking, but every time I see it, it seems bizarre to me. If the candidate was to propose any project once hired, I'm sure these folks would want them to think about costs and benefits.

This policy selects either for people unable to reflect on their life with the same wit they apply to work; or people who will front about their motivations. Both seem like poor outcomes.