I agree with @moeknows - I think there is a time and place for the "sandwich technique", but it's wholly dependent on the individual which you're trying to correct/motivate. For example, I have done quite a bit of project management with artists and creatives as the main chunk of the crew, and they tend to be a bit more sensitive with criticism. For some people, they just can't take the clear and direct approach.
But ultimately I agree with your sentiment that generally speaking it's not the most effective technique for most people.
The KEY, imho, is to give clear feedback without making ANYTHING personal. I'm not just talking about direct insults, I'm talking about just avoiding the word "you" when giving feedback. If you make the feedback about the project/product, and not about the worker/creative/person, then they're usually in a good headspace to get what needs to get done, done without feeling deflated. ...because it's not about them, ultimately!
I like your idea of focusing on the project / task, not the person. That way your feedback, even if it's direct, is not threatening and can be taken and accepted. I still see there's no suitable situation where the "Sandwich" technique can be useful... You either give sincere and genuine compliment and praise, or you focus on what needs to be corrected / developed / changed in a non-threatening way. Mixing those up won't get us the results we want or hope for. Thanks for your input, I agree with the core of your message.