He has it all mixed up, Angela. It does kill soft bodied bugs like lice/weevils when dusted on a bird or when put in feed, which is why I put some, maybe a cup, in newly opened feed bags, but I do not give add it to feed at that 2% ratio because there have been studies (wish I could find that link) that showed necropsies on birds fed DE at that rate had badly dessicated intestines, not a good thing at all. Logically, if it doesn't work when wet in one case, why would wetting it help in another? He's just plain wrong.
I do use it, and it works for what it's good for, but I never depend on it to worm birds. Too many necropsies have shown birds full of worms who were fed DE as a wormer, sadly.