That arm test is one of the most subjective, unscientific test I've ever seen. The only way you could know they didn't fake the whole deal is if YOU were the one under test. They do say you can do the same thing, but most people I know who would be likely to try tend to WANT there to be a correlation or already believe their cellphone is hurting them, thus what do you know - it works...
A cell phone that isn't being used rarely transmits, and then only for very brief bursts. If the effect so suddenly goes away when she applies the "chip" to the back of the phone, then he should be able to resist her normally with only the occasional brief "sag" when the phone transmits a packet. It would have been (marginally) more believable if she had him *use* the phone during the test - thus guaranteeing continuous transmission.
And the idea that applying a passive square of material to the side of a phone is going to somehow magically change the effects so they don't bother a person is ridiculous. People have been selling junk like that for years, though, and people keep buying it. (For that matter, the "snake oil salesman" has been around for as long as there have been people, I'm sure...)
People have been claiming bad side-effects from EMF / "radiation" for years. The earliest one I remember is living near high-tension power lines - supposed to give everyone cancer. Had people freaked out about the power lines in the back yard and even the wiring in the walls for a while...
Another popular one nowadays is "WiFi sensitivity". People are claiming they are being made ill by the presence of WiFi hotspots. Except the few that have actually allowed themselves to be tested can't tell the difference between wifi-on and wifi-off. Most refuse to be tested - wonder why...
There is also a difference between ionizing radiation and non-ionizing radiation. Nuclear, X-rays and similar are ionizing. That's the bad stuff. Electromagnetic waves are non-ionizing, and what they do to tissue is induce some heating (like a microwave) but it takes far more power than a cell phone or wifi hotspot generates to be a problem. I think most people who freak out about "radiation" in general still have some fear of nuclear energy / weapons, don't know the difference and simply lump all "radiation" into the same "bad" category.
There are also just some nut-jobs who either like the attention or just dislike (take your pick) new technology, other people, the government, etc...