To be honest, it does happen.
I suppose it depends on the industry, the skills required for the position and the physical nature of the position.
Some employers see older workers as overqualified and seeking high salaries, or they believe they're inflexible and technologically challenged.
We, as a recruitment agency, frequently get requests from employers for candidates not over the age of 40, they specify male or female and will ask for a recent photograph or uniform sizes to ensure that the candidate is not overweight.
It's against the law, of course, to advertise based on age or gender, but these sort of 'wishlists' are coming in on a daily basis and clients will not review candidates if they do not match this criteria.