Tested this out last night and do not have the issue at all. You def. have a defective unit I would say.
Ok gave this a shot myself, an I didn't have the issue. It did get me to thinking tho. I have a Samsung 5271 TV, that the only way you can turn it on is by touch. Whats funny is that I can turn it on fine, but the touch won't recognize my cousin's input for whatever reason.
So I did the styrofoam issue with him.........work's fine for me......but for him, his input is not recognized. I just laughed at him and told him it was cause I eat HolyGrain cereal.
My theory: Styrofoam can carry static electricity an I believe this has something to do with it. Some touch screen recognize electric impulses, and someone with a high resistance to static electricity could be the cause.
For my next experiment, I'm going to pour water into a plate, place my Incredible in it. and see if it responds .
I highly doubt its a phone issue after the video shows he has 2 replacement phones with the same issue.
I have fixed my first post to theory...to better reflect what I meant.