You won't stop at the exact position, so there are going to be some adjustments that need to be made, but overall it's quite close to 9.5 bits, as he says.
I guess I mostly don't see how he defines turning a dial as being equal to 9.5 bits. I understand why he says it would take that many bits to store that decision, but not how a dial gets you there.
To that extent you're not "going through them one by one", but getting into the proximity, then backtracking (or advancing slowly), and only then going through one by one for a dozen or so variations until you reach your desired option (roughly). It's not as technical, or as precise as he presents it to be, but this approach of tackling UI complexity does give usable approximations of complexity, even if imprecise.
EDIT: or, what jcromartie said http://news.ycombinator.com/item?id=1242929