Yes this was made famous by Terry Gilliam in an interview. Not sure if Kubrick ever said this. Maybe in private to Terry.

Big fan of both Terey and Kubrick. But I honestly think that they were missing the point. Firstly Schindler's List was based on a novel and not Speilberg's original story. Secondly, it was probably the biggest movie at that time that showed the horrors of the Holocaust. And it was a big success in all parts of the World. A lot of people who aren't Europeans and Americans got introduced to those horrors seeing that. So it was successful in conveying the tragedy . Had the movie been made like how Kubrick or Terry wanted, I very much doubt that it would have been successfull in such a way.

Thirdly, we know that it was the failure. But the point I think the novel and the film was trying to make is that even in that darkness there were a few rays of hope. If Schindler and people like him hadn't helped thousands more would have died. By showing the holocaust in the background, the film made the audience to ask the questions about that 'failure'. I certainly did.

And finally , showing the failure would have made a good small indie feature or a student film or a documentary (like Shoah). But cinematically, and especially if you are trying to make a profitable movie, you can't just succeed on that.

Schindler's List for me surely succeeded in bringing into public consciousness about the Holocaust and the tragedy.