What can I say. I've heard this myth from very experienced bondage tops (even instructors), and it boggles my mind. The rest of this site has given a lot of information about other signs of nerve damage – loss of movement CAN be a sign, but it’s often a LATE sign and you can have serious nerve damage but still have movement in your fingers… and then you’re untied and realize you are numb, and have poor fine motor control, and have wrist drop… but those fingers wiggle all around!
One reason this is so egregious is that there are different types of nerves -- some just carry sensory information, some just carry motor information, many are “mixed” (they carry both sensory and motor information). So it is certainly possibly to damage a sensory nerve without damaging a motor nerve. For example, the long thoracic nerve has no sensory functions, while the median nerve where it goes into the hand has 5 branches with only sensory (no motor) functions.7 Bottom line: assessment for nerve damage is much more complicated than wiggling fingers.