Will the warm water on the blade discolor the buttercream? 

I think yes but she is covering with fondant so it doesn't matter here.

I'm guessing that it must work out otherwise this tutorial just wouldn't be up here...but the idea of heat..buttercream..hot water combination kind of sets alarm bells ringing for me!! Duly noted that the bench scraper only DIPPED in the water so wasn't REALLY hot, but the excess was dumped back in the mixer; would that still be usable considering it would necessarily be slightly wet??? I'm always game to try different techniques, but I don't wanna waste a batch of IMBC if I can help it... (tho it would count as cooks perks...?)