Usually, no it is not intentional or necessarily cutthroat. However, creative fields are notoriously hard to make a living in and the competition is inherent. Everyone is being sized up for future prospects.

Granted, I was an art major not a music major, but I think it may safe to say that if a professor has confidence in you or likes you, they may refer jobs to you later on (freelance etc.)

I agree that I would be designing in some form if I was paid or not. Paying is definitely the better gig.