That's something a few do; those are routinely condemned for it. Mostly it's outsiders who need a strawman: They see the groups that spout this to excess and then act like every suggestion of blessings for obedience are precisely this. A fine-brush is needed whenever examining a fairly complicated set of views when you're an outsider and have strong motivation to get it precisely wrong for one's own psychological, political, social, or ideological reasons.
The opponents are often hypocritical. They rely on traditional Xian views for support--then deny that's anything but a really horrible argument when it comes to aspects of doctrine they don't like. Faculty will say that a true Xian will have a hard, poor life as they rely on tenure and book royalties to have a really nice house and life. And when those who aren't wealthy spout "prosperity gospel" tripe, say they have to give up everything (mis-citing a Christ they often don't believe in) even though they often have less than those insisting it's necessary to give up everything. The response is, "Well, that's not my belief, that's yours"--when it's really neither person's. (Similarly, a lot of people argue that American Xians really can't ever be called persecuted, and point to the massacres that happened from time to time in the past. Then they turn around and say that the poor are persecuted, that massacres aren't really the definition of persecution. Making less than 133% of the poverty level is persecution.)
Most churches that have some version of this still don't make it central. Nor is prosperity necessarily seen as a sign of greater righteousness--that's the heresy. Some people fall for this; for others that aren't just looking for justification (to think they're great or to think they're good Xians), it definitely isn't. The ascetic movement (which is still alive in attenuated form, by the way) falls for the same kind of heresy: It says that outward signs and status show your standing with God. All you have to do is manipulate those and God's in your pocket. Get more $ and God's automatically pre-approved your application for salvation. Junk your junk and live in a cave, and you're fast-tracked for credit approval in the Divine Treasury. For both sides, it's really about self-salvation and making sure other people, losers all, recognize how truly awesome they are.
Take my old church. It always had some version of what could be called "prosperity theology". If you do well, you'll be blessed. If you work hard and are righteous, you'll be rewarded. There's no automatic requirement imposed by God to suffer. God doesn't so much reject people when they have a sufficient diet and housing--he rejects people whose focus is on external things like that instead of trusting him. The rich young man wasn't pitied because he was wealthy; he was condemned because he loved his things more than he loved God. On the other hand, sinners also do well, and often do much better than the righteous. Meanwhile the righteous can be tested, as was Job, and be brought to ruin.
The opposite viewpoint is equally insane. God checks your finances, and says you're blessed or cursed based on assets. It's not your attitude towards God; God's really all about the benjamins. If you have a lot, you're a sinner. Of course, you can become righteous by giving your money to the poor so they're now reasonably wealthy (presumably they automatically become unrighteous as soon as they fail the divine means-testing). Perhaps the real way to righteousness isn't helping the poor but just burning all your cash. Then we could all be at subsistence level poverty and homeless, and the advocates of this view would be happy. (That's not what they want, of course; it's not that others have, it's that others have while they don't have.) But it used to be the case that the poor were truly poor and as a result relied on others and had to recognize that, rightly or wrongly, they were dependent on others good will; they didn't follow Jesus, at least in the NT narrative, because he offered them food as a bribe but because it was easy for them to rely on God and not their own money.
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. However this anxiety made them strive really hard in all their endeavors and when they succeeded in some worldly way, they breathed a sigh of relief: "Look, God has allowed me rewards, maybe I'm one of the Elect." It has been suggested that this Calvinist anxiety was a significant force in the rise of capitalism in Northern Europe. (There's a book on this by Max Weber.)
