I find the total opposite. In my experience; the internals tend to have more issues that externals. When you do have railway experience you see the railway from the "what happens in reality" viewpoint and often carry a fair bit of baggage. I think the predispositions some have, can negatively affect their training.
Again, that's a sweeping generalisation. Some of the internals I've seen go through have been superb candidates. At my TOC's training school one of the new trainers was originally platform staff. Now they are a Trainer up the school. I would say her experience has helped her along the way.
There is a level playing field. Clearly some candidates may have some insider knowledge and some have skills in certain places where they excel. No doubt those with a retail background may have good customer service skills and those with a legal background may be good with rules, regs and policies etc.
You have to play to your strengths and be flexible about your weaknesses. What are you good at and how that can be applied is something interviewers are looking for. Identifying where you lack knowledge or need help is just as important.
