From what I understand this doctrine teaches that one must stop sinning/repent before they can be forgiven and saved.However, a sinner cannot stop sinning until after coming to Christ and being born again receiving a new nature which can overcome the old sin enslaved one.
Since it is therefore an impossibility for a sinner to stop sinning/repent it is therefore a hinderance towards one getting saved to teach this.
You are right in saying that a sinner cannot find freedom from sin until they are first saved by Christ. Only through the power of the Holy Spirit working in regeneration can a person overcome sin. They must have a new nature before than can have a new manner of living for the glory of God. So in this regard, it is certainly true that it is a tremendous hindrance to tell sinners to "stop sinning" and then come to Jesus, because such is absolutely impossible, and will produce hopelessness at worst, and Pharisees at best, and never result in real salvation because it is tantamount to salvation by morality, self-effort and works.
However, with that being said, that it not what traditional "Lordship salvation" teaches or believes. While there may be extremists here and there who teach sinless perfection or that you have to stop sinning completely before you can be saved, there are also many real teachers of the Word of God who hold firmly to a "Lordship" position.
What they teach is that you cannot divide Jesus in parts and receive Him as Savior but reject Him as Lord. If you reject Him as Lord then you cannot expect to receive the benefits of His saving work. According to this belief, true saving faith that results in salvation is a faith of submission which manifests itself by willing, loving, and obedient submission to Christ as one's Lord, Master and King. Therefore, to reject obedience and to reject Christ as Lord of your life is to evidence that you have never had true saving faith, despite the fact that you may profess Him with your mouth.
In other words, while obedience does not save, it is the essential fruit and evidence of having been saved.
[i]Matthew 7:21 Not every one that saith unto me, Lord, Lord, shall enter into the kingdom of heaven; but he that doeth the will of my Father which is in heaven.
Luke 6:46 And why call ye me, Lord, Lord, and do not the things which I say?
Titus 2:11-14 For the grace of God that bringeth salvation hath appeared to all men, Teaching us that, denying ungodliness and worldly lusts, we should live soberly, righteously, and godly, in this present world; Looking for that blessed hope, and the glorious appearing of the great God and our Saviour Jesus Christ; Who gave himself for us, that he might redeem us from all iniquity, and purify unto himself a peculiar people, zealous of good works.[/i]
Perhaps the best known defender of this (correct) view is John Macarthur in his books, "The Gospel According to Jesus" and the follow-up, "The Gospel According to the Apostles". They are excellent books and well worth the read. He also has some messages on his website which are preached based on the message of those books.