True, the results are on paper and presumably will be accurately counted eventually. The concern is that this fiasco was meant to occur if the DNC felt that Sanders was going to win in a landslide. Some believe this was done on purpose to rob him of any momentum this morning, and to allow for other candidates (read: actual members of the Democratic Party) to claim some sort of success as the news cycle moves forward to tonight's State of the Union, tomorrow's Senate vote, and then the NH primary.
The people who supposedly made the app are very close to the DNC (https://shadowinc.io/about). I can't even say I'm 100% buying into this theory regarding sabotage; they probably just made an app that wasn't up to the task at hand.
Every indication I've heard so far (I live in Iowa, not that it matters since this is a national story) is that it was just gross incompetence on the part of the app maker.
They repeated all morning on the radio "No interference or hacking."
Really it's just a classic case of people under-preparing and shit hitting the fan because everything didn't go 100%.
The DNC has a significant amount of influence over the state level party organizations.
There's also plenty of tinfoil hat fodder (some of it very valid) related to how connected the company that developed the app is to certain parts of the national party.
All that page claims is that one or more members of their team worked at the DNC at some point. That's not exactly persuasive evidence that the company is some kind of purpose-built DNC kamikaze cruise missile. It could just as easily mean they've got some people who worked low-level jobs at the DNC, and are now trying to leverage that connection to sound like bigger deals then they actually are.
That's not what the tweet says, the DNC did not suggest they use the app. What the DNC said is that the previous method they were going to use (online voting) could be susceptible to hacking and so wasn't acceptable. The Iowa Democratic Party then decided on another option.
There is a compelling case to be made that manipulating the reporting of results (rather than the results themselves) would be more in line with your goals of public perception and deniability.
Anyone that's worked on a system with distributed state knows data consistency can be hard, particular in situations where the system comes under load and latencies begin to increase.
You're not specifically complaining about it, but I think it's interesting that they are being criticized for not being transparent, and then being criticized based on that transparency when they are.
People having been posting the paper caucus records left and right on Twitter and elsewhere. I wouldn't be surprised at this point the internet mob could count the results if someone tried to organize it.
Edit: Apparently all those paper sheets also have PIN numbers to log into the app, so that probably is a contributing issue.
And some security testing and analysis also wouldn't have prevented this problem, unless it was done at huge scale.