Honestly in day to day programming I find data types & associated APIs are so so much more important than algorithms.
I would rather work with a flexible data type with suboptimal performance than a brittle data type that maybe squeezes out some extra performance.
Your example of in-place array mutation feels like a good example of such a thing. I feel like there should be a category of interviewing questions for "code-safety" not just performance.
I would rather work with persistent data structures, the least brittle of all, which would also in many cases trivially allow me to parallelize the work, but as far as I can see all the leetcode problems are low level mutation based problems with no clue about functional data structures. Clueless interviewers look to these problems as if they alone epitomized great programming, while they are often inflexible single core stuff, that may not even be appropriate for this day and age any longer.