It's a little buggy as it is an older plugin from around the XSI 3 era. 2010/2011 has editing user normals as a standard feature which works a lot more smoothly. There's quite a few different ways you can go about bypassing any visual glitch and seeing it with your texture in older versions, though I generally only use…
I think you just don't know how to use it to be honest; it does the same job. Press the ? in the corner of the PPG for documentation just like any other thing in XSI. In the case of the tutorial, hit the button to align the normals by the axis you want so that they all point up. From what I can tell of the Chrome…