Rather the opposite.......lots of the islands' best players used to be drafted into the All Blacks which gave the ABs a big advantage......these tgen sometimes reverted to their 'proper' nations later in life. It seems that recently this has slowed or stopped and we are seeing better island teams. I think they used to leave for the money.
It happened less than you think.
There is a mythical element to it.
Although decended from Pacific Islanders, most were born in NZ.
There were a few who flouted the rules, like the Bachop brothers, swapping regularly between NZ and Samoa. Interestingly, they were born in NZ.
Similarly for the great Michael Jones.
He got his first ever cap playing for Samoa before having an illustrious career for NZ, but born in Aukland.
Many players playing for an island nation after NZ or Aus are actually going to play for the country of their heritage rather than their birth.
Australia are probably worse than NZ, usually in league rather than union.
The home nations are far worse than NZ.
I mentioned the case of the Vunipolas. Tongan parents, Billy born in Aus, Mako in NZ, grew up in Wales, recruited by England.
Dylan Hartley was from SA.
Scotland have the kilted kiwis, with others from SA.
Wales suffered with Grannygate.
They currently have several players born outside Wales, though qualify through other eligibility rules.
I've not looked them up, but believe Tom Francis, Faletau, Rowlands, Henry Thomas, Christ Tshiunza, George North, Nick Tompkins and most notably Gareth Anscombe, all born outside wales. All eligible through parents / grand parents except Tshiunza (I think), Faletau and Anscombe. The first two qualify through residency having grown up and been schooled in Wales, Anscombe came over as an adult but has been here long enough under residency rules. I think he is from Aus.
Ireland have 'recruited' well, most noticeably Bundee Aki.
I don't like the rugby eligibility rules. Think it should be simply the country of your birth or that of your parents or grand parents. I get the residency bit where someone grew up and learned their rugby in a country, but not where they came to a country to play the game as adults and stayed. At least residence rules are 7 years now. They used to be 3, so anyone going to Uni in England from Wales could qualify for England, which was often the case. They've nabbed a few of ours.
Possibly the worst country for nabbing players not born there is Japan. Lots of NZers and pacific islanders representing Japan.
Anyway, in summary, NZ very, very, very rarely exploited their pacific neighbours. The vast majority of players who have represented NZ were born there, unlike many other countries closer to home.