This definitely does happen and it is attributable IMHO to poor coaching.
First, many coaches believe that they are too prone to getting burned inside, so they pitch away. And in fairness, it is true that you lose the ability to break a bat by hitting a guy on the fists, when you're playing amateur (metal bat) ball. Also, there was a period when the Leo Mazzone school of thought (expand the outer boundary by degrees) was very much in vogue and some folks haven't let go of that to this day.
Second, many pitchers get scared of hitting batters when they're young and do start moving away a lot.
The flaw in the thinking is exactly what d8 and larry have said. The batter is going to move up and make the outer half his happy zone. And now you're pitching to a plate that's only half as wide as it should be, so you walk a lot of guys, too.
A coach needs to pound into his pitchers' heads the fact that it is essential to success to own both sides of the plate. I would never advocate throwing at batters intentionally, but on the other hand, you cannot let a batter dictate to you (by crowding the plate) that you can't come inside, either. If he gets hit, well, that's his fault, not the pitcher's. To me it's all about attitude, and a successful pitcher usually has a touch of cockiness that he works with. Fear of hitting the batter is antithetical to that, and a good coach needs to stamp that thinking out.
There aren't many players who are willing to get pelted over and over just to reach base. And putting a little fear into a batter's mind is a powerful tool.
When you knock a guy off the plate, suddenly he loses track of where the strike zone is. A pitch on the outer edge looks outside to him; he'll take strike 3 there if you have brushed him back first. If you buzz a fastball under his chin, a curve that starts at his ribs and breaks right over the heart of the plate will often freeze him, too. If nothing else, knowing that you could go to the black on either side of the plate helps keep the batter from really teeing off on any given pitch, since he has to cover a larger zone. The result is more fisted pop ups and dribblers, more K's.
The battle between a pitcher and a batter is all about who's in charge of the other guy. If you concede half the plate to the batter, he's in charge and you are back pedaling before you even start.