Get ready to die.
This article is a prime example of the Anarchist's Cookbook's failure to provide accurate information. A small amount of applied chemistry will hopefully give you a more accurate idea.
The Explosive
Most people will tell you that this compound described above is Nitrogen Tri-Iodide (NI3), a stupidly unstable explosive. High explosives, such as NI3, normally produce large quantities of gas very quickly. Nitroglycerine, for example, is reasonably explosive because of the Nitrogen, Carbon, Hydrogen and Oxygen contained within, which can reasonably easily change itself into some variation on more stable compounds, such as Nitrogen gas, Carbon Dioxide gas, and so forth. In the case of NI3, the gas produced will be Iodine - 1.5 moles of gas produced for every mole of the substance.
In fact, these people would be slightly wrong. This method of creating the explosive will actually give you an ammonia complex which will surround the nitrogen and make it much larger, making the compound slightly more stable. I'd imagine that this is also the reason why dissolving the compound will make it slightly safer to handle - the ligand in this case being water. This does not detract from the fact that it is stupidly dangerous to handle. Search around on the internet for a moment, paying attention to educational websites (think kinetic stability vs thermodynamic stability), and you will find videos of carefully controlled samples of this compound being detonated with a feather. Anyone foolish enough to pick up a largish sample of dry NI3 (Technically [N(NH4)6)]I3) with their bare hands and attempt to disturb this paper, by scruching it into a ball as suggested in the article, or just breathing on it too hard, will probably lose their face.
Say we have a 5 gram sample of a substance we will assume to be pure NI3. This would be roughly a tablespoon. Now, using high school chemistry, Moles = Mass/RFM.
Moles = 5/(127*3+14) = 0.0127 Moles. Not a lot, right?
When it explodes, it will all decompose, because it's very unstable. It will decompose via the following equation.
NI3 -> N + 1.5 I2
As you'll all recall, at standard temperature and pressure a mole of gas will occupy 24 litres. So;
Volume = (0.0127*1.5)*24 = 0.457 Litres.
This does not sound like a lot. But I've based my assumptions on the idea that I'm using the minimum amount I could obtain without getting a negligibly small amount, which people hoping to play a prank probably wouldn't do. And 0.457 litres is still 457 cubic centimetres. Remember those little blocks you played with, in primary school? 1cm3 each? Imagine 450 of them appearing, blowing off your hands and destroying your eyes. Even if you survive, enjoy your lungful of iodine gas, which will temporarily blind you and make you choke instead of scream for help.
Webelements have their own NI3 video: http://www.webelements.com/webelements/elements/media/moov/NI3.mpg
Further details/corrections would be appreciated.