This problem is pervasive to say the least.  

I can understand a company looking for someone with a degree that has little experience if their goal is to pay a lower starting salary and spend time, effort, and money training the junior person.  Receiving good marks in a broad foundational education can be reflective of someone who is ready to be molded. Sadly, many companies today don't invest in their employees.  They expect them to somehow find all of the experience on their own through projects.  This is tough when so many team members today are part of teams where everyone performs very narrow and specialized roles.  The team member gains little breadth of experience.

Much more weight should be given to actual performance and experience.  But a lot of companies are "lazy hirers" or have never been taught how to interview and hire well.  They set guidelines like a 4 year degree and apply it to rigidly.  I would gladly take someone who has the experience I need whether they have a degree or not.