I strongly disagree, I have years of 3d modelling experience and if you are blocking out and prototyping a level there is a high amount of iteration and testing and bsp is the most durable, fast and efficient method of doing this. Going back and forth between two programs and reimporting etc is not good workflow.
I've had plenty of experience with U3 and source to make a good comparison. Unreal's BSP is a hard beast to tame and lighting bsp surfaces in is hideous - no smoothing or curved surfaces, big ugly Lightmaps seams everywhere where the BSP unncessarily cuts up faces and the texture/alignment tools are terrible, and of course rebuilding to see your changes is not efficient. Like i said it wins in every other aspect as far as im concerned but Epic have really neglected the BSP side of things, I mean they even removed some BSP features that were from the 2004 engine.