The people controlling the monster hands couldn’t see the faces of the actors they were aiming for, so I imagine this led to quite a few unpleasant eye pokes and ruined takes.
That is actually a pretty clever solution for someone who wasn’t a production guy in the strict sense.
But practical solutions were needed for production problems such as this, and they often required some outside the box thinking like Dick Cavett proposed.
Nowadays the shrimp hands would probably be completely CG, or there would be a quick digital fix for this issue.