If I understand this right, aren't they putting the motor around the prop? While it cuts down on noise, doesn't it increase, or at least give it a distinct, magnetic signature?
Also, magnetic fields don't self propagate, really. That means they fall off extremely quickly with distance unlike electromagnetic waves.
[0] https://en.m.wikipedia.org/wiki/Magnetic_anomaly_detector
Free space impedance is 377 Ohms/meter; the ratio of E/H fields. Seawater is much, much lower, but the ratio is still there. If there's a propagating H field, there is a corresponding E field; that's the law according to Maxwell.
The VLF antennas on the subs are trailing wires; electrically short dipoles. Those are mostly sensitive to E fields.