A one-week trial run seems like a very bad idea to me. I wouldn't even consider going through such a long interview process. It's basically a low-pass filter on your candidate pool - maybe that's the goal?
The idea of a "trial week" can probably upset some applicants, but that's not necessarily always the case. An applicant who feels confident about the culture fit and his/her skills may very well think that there's little to no downside risk starting through a trial.
In addition, the trial week also works the other way around, where applicants can determine if their initial gut feeling about the company is right. If not, there's an easy way out, and the worst case scenario is a loss of a vacation week - not unemployment.
Sure it's reasonable in one instance. But what if every company started instituting these trial week scenarios? Then it quickly becomes untenable. There's just no rational basis for an applicant to "feel confident" in anything that isn't in writing. This scenario is designed specifically to give the employer even more power and leverage in a hiring transaction. The only people who would be willing to jump through such hoops are kids fresh out of college or otherwise desperate folks. It certainly isn't going to bias your hiring process towards "rockstars".
"Rockstars" probably aren't going through traditional hiring funnels anyway, so don't worry about that.
A negotiated trial period is typically good for both sides and probationary fire-at-will periods are often much longer anyway. A one-week trial could be better for the employee if they can go back to their existing job.
However, it should be negotiated on both sides, I agree with that.
That's great for the both of 'em, what about the other guy who quit his job and was not hired? He's now out at least 1 month salary as he needs to start from scratch.