Take-home assignments: reasonable filter or unpaid work? Pretty torn after this week

Just got a take-home that's realistically 6-8 hours if I do it properly: build a small API, write tests, dockerize it, plus a writeup. And it's only round two of five. Part of me gets it (they want real code, not just leetcode), part of me is annoyed I'm doing a mini-project for free while holding down a full-time job.

Where do you draw the line? Power through them, timebox to 2 hours and submit whatever's done, or decline and ask for a live pairing session instead? Curious whether declining has ever cost people offers, or if the good companies actually respect it.