As far as I know it is not a common practice. When 1000 cankers showed up in the area the city of Boulder decided to have them all removed, there are a few left in Boulder and more in Longmont but they are mostly gone. A few nice ones were saved inadvertently where folks had been using merit onsite for other reasons. It could be a thing though, I am not well in touch with the ipm providers in my area.
I could very well be wrong, I do remember cases where a lawn or tree treatment had inadvertently saved the walnut, not 100% on what product it was.
The lumber is good, I don't remember ever seeing a rotten walnut.