Has the time for that toilet visit been properly recorded on your time sheet? No really I had a boss who insisted we log every second and micro managed my time like that. It sounds to me though that perhaps they're a small company without a separate hr department and reading cvs and portfolios takes time away from production. It's much the same where I work now and that's not gamedev. If it isn't an immediate business need, it gets back burner'ed...If these people are so busy, do they stop to take a shit once in a while?
Remeber that in a lot of cases hiring an intern will actually cost a business money even if they don't pay a wage. An intern still must be supervised and have a mentor, while someone is supervising and mentoring an intern they can't do their normal work or will do so in a reduced capacity. Hiding an intern is an investment hoping to be paid back in the future once you have real skills, and can also be a risk. Because of the risk they don't hire many and won't hire just anyone they're looking for an aptitude to learn without consuming too much mentoring time.
Hope this helps!