the thing is, the "he really knows his stuff" guy usually doesn't. He somehow convinced the top guys 5-6 years ago that he did, and now they think he shits gold, when in reality he is very mediocre by current standards
What's worse is that he thinks he shits gold... I've noticed that certain personalities tend to go this way as they learn something well - they use their knowledge it to feel better about themselves, as if the entire point of learning was to make up for insecurities. Once they know enough to sound knowledgeable, they stop learning.
The worst thing about this is, I think, that it becomes impossible to hire people smarter than them.