This person is right in many ways - if he has been breeding his own lines for X number of generations, then he knows about health issues that may or may not be there. Most breeders will use an outside stud, so pedigree is important for knowledge about the health of the dogs in the line they are breeding to.
Many, many, many breeders that work, title their own dogs, and try to keep a balance of temperament, so that the dogs of their breedings are versatile and adaptable that can work on farms, do Schutzhund, agility, be service dogs, family pets, calm in the house, active on the job all day, etc - would echo this man's sentiments. True you breed the dog in front of you, not the pedigree, but the pedigree brings the unknown health and temperament of the dogs in the family tree out into the light.
I would consider a dog from a person like this, since the dogs prove themselves every day in their work. Refreshing to see a breeder that walks the walk, and not just talks the talk, bragging about 'Champion Lines' three generations back, but wouldn't recognize working temperament if they received it gift-wrapped.
I bet this guy has some very interesting insights into GSDs and breeding for a balance.