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Prototypes are the most powerfully tool I know of for increasing the productivity of conversations about what software should do and how it should work They're tools for thinking

They are tools for thinking if after the prototype you sit and write down what you learned in the form of specifications. But most of the time people use them as a first iteration of the product, and having something tangible gives them the false impression they have the product figured out.

No, they eliminate alternatives that haven't been thought of. Unless you're talking about paper prototypes, then they're always useful especially for usability.

Paper prototypes are not always useful, I'd say. They are nice for quickly evaluating ideas for UI structures. For evaluating e.g., acceptable latency of a UI, one would want to build a high-fidelity prototype. (BTW: It seems like everyone here is equating "prototype" to "app with user interface").

I am trying out this approach in real for my projects now. Previously, the feedback loops with my stakeholders were large and now with PoC becoming disposable, I can quickly show around what I aim to achieve with my project and then iteratively proceed towards the final design.