I spent four years as a contractor between 1997-2001 and all my work was sourced from recruitment agencies. Remember that the recruiters have no idea about anything technical. They match the buzzwords from your CV against a company and if they look close enough will forward it to the company. I once had a recruiter call me up to ask what 'API' was. Not sure he was capable of understanding it was a generic term and not a specific technology.
Use them to find companies to work for but apart from that you should ignore their advice. Be willing to work for a lower than standard rate for the first job in order to get some experience on the CV. If you work somewhere and you really impress them, become indispensable then you can up your rate when the contract is renewed. Make sure you keep contact details for other contractors so when looking for a new contract you can ring around to find out who is hiring.
