I once experienced flight instructors doing instructing in Cessna 152's just to collect the needed 1500 hours... once they got that, they were gone and I needed a new instructor (and their instructing style was needless to say NOT very motivating!).
My ex started flight training at 18 yrs. old... starting with the usual Beech Barons and Aztecs. At 21 he got his ATPL.. that was 1969 and I have no idea how many hours he had. He went directly to co-pilot flight training on 737's (I believe it was 3 weeks or so in Portugal with REAL 737's!) and went on line with a major airline (which he had been training with).... at 21! He flew the 737's, then transfered to co on 707's and international flights. He always said what great hands-on training those birds were!
With 26 he went back to 737's.... as CAPTAIN! He was the youngest captain at the time. As a captain on 737's, he got all the newbees and it was part of his job to share his experience with them.... like an instructor. I think THAT is what the FAA is talking about! He often mentioned, too, that many newbees were good at computer programing but no longer had the feeling for flying.
After about 15 yrs. on the 737 he went into captain training for 747-400's (he hated leaving the 737's, which is why he waited so long to advance). That was 1992. He just retired last year at 60 yrs. old.
So, as you see, it is NOT necessarily a matter of hours. I think it is more the type of training that's important. In a similator you can learn a lot, but not everything.