Would the demo be less baffling if Dr. Lewis had stated that he just showed a single-turn transformer with and an oscilloscope measuring the induced voltage across a loop including the measurement leads, and that Kirchhoff's loop rule may not apply to circuits with transformers, couped inductances and transmission lines?
I doubt that. If you look at the circuit at a point frozen in time then the currents should still add up to zero (time domain analysis). The caveat is that the induced current is a source which should be included in the circuit if you want to model it.