LISP relies on tunneling, and tunneling is not 100% perfect. At times, the tunnel passes a packet that's too big and it disappears without a trace to the sender or the recipient…That's really bad.
We all know what can go wrong with the tunnels: a combination of:
- MTU setting on a core link that is too low to accomodate tunnel envelope+payload with
- Tunnel headend that cannot respond to Fragmentation needed ICMP message.
I sincerely doubt that the authors of the LISP draft would not be aware of those problems (Cisco's gear is one of largest source of tunnels in the IP world) or that mr. Huston would not know what he's talking about (read the MTU articles on his personal blog).
The only explanation for the fairy-tale quote in the article is thus the process of multi-tier simplification until facts became adjusted to the technology awareness of someone in the publishing pipeline.