I hate to say it, but if you look closer, Gary makes sense (even though his solution is not the best one).
I worked at a place whose idea of CMS was to pass around Word forms via e-mail, which finally make it to the "developers" who use DW templates to import the Word form fields. Supposing I update template, then I must update the Word form. Now how do you think I got everyone in the company to use it instead of the previous copy they already had? Right. To make matters worse, different sections of the website had different DW templates so as to change themes, but top nav and bottom nav items were supposed to be the same sitewide, I've got to keep track of a dozen templates each with a dozen more Word forms. (SSI, scripting, or frameset would have been preferred IMO, but they refused to allow SSI and would only tolerate Perl which I'm not going to waste my time with). If you haven't been in such a frustrating position, no wonder few of you get what Gary means.
Gary seems to be saying she's got the wrong template for this task. Instead the non-editable regions of the template should be separated via frameset (top or left for nav, bottom or right for content). Then, treat each Word file as a single page which, once converted to HTML, goes directly into the content frame - no import necessary, except maybe into very simple templates that only set the style sheet and stuff. His ranting gets in the way of conveying that, though. He encourages her to "sub-page". That, in itself, is no more ridiculous than using CSS to replace IFRAME, which people do, or using CSS to water-mark navigation items, which people do, or using Flash for scrollable displays, which although reprehensible, people do. How is frameset a worse idea than all that crap? It's the only one that follows a strictly supported standard...
When he says "my pages, or anybody else's pages will interfere with your code" I bet he means that she's obstructing developer collaboration at that particular company: If a user opens her non-frame page into the content frame, and she links to one of the other developer's framed pages 1) if in a new window, it will be missing its parent frameset, and 2) if in the content frame, they get redundant framesets. With JavaScript disabled, that could easily happen.
There is really no WTF here except Gary seems to have skipped every English class since Freshman high school. He's not talking about doing something stupid; who of you have not gone to great lengths to isolate (visually and logically) content from one source from content from a different source on the same page? You guys just don't think frameset is the right way to do it. Run into a problem like what I had with my company and then tell me.