I went and read the site you posted, but it does not actually tell what's causing the bubble hair. It just uses anecdotal evidence and shows what bubble hair actually is, so I went and looked at some other information on bubble hair, so I found this
NCBI/NIH experiment which tried to pinpoint a cause of bubble hair:
So from this case study I believe that bubble hair is caused by overheating of the hair.
Now, when flat ironing wet hair, your hair is covered in water that evaporates once the heat of the flat iron is applied. The heat energy from the flat iron goes into evaporating the water on the outside of the hair shaft FIRST. The amount of energy it takes to evaporate that water takes away from the amount of heat your actual hair shaft experiences.
So, unless the heat of your flat iron is MUCH higher than you usually use on dry hair, it shouldn't be more damaging than the use of the flat iron on dry hair. It should actually be a cooler experience for your hair shaft. Iris said herself that her hair never gets really hot while flat ironing wet. And Nonie also showed how the results of the first pass were much like a blow dry (hence, the flat iron evaporated the water).
In conclusion, I believe that if your hair gets bubble hair from wet flat ironing, it is because your flat iron is
too hot, NOT because your hair is wet.
Water does not necessarily have to boil to evaporate and even if it does, the boiling point of water is lower than the heat of the flat iron (100 degrees Celsius, 212 degrees Fahrenheit). Once the water's temperature has reached 212, it becomes water vapor and floats away from your hair (this is all assuming you haven't dissolved anything in the water such as salt). So the water that actually touches your hair is never hotter than 212 degrees and the heat from the iron that actually reaches your hair is around 212 degrees COOLER than the heat setting on your iron.
I believe that as long as you are using the flat iron at the same temperature that you would use on DRY hair, your hair SHOULD be fine.
...oh and that's just my opinion, heat is heat. You should always be careful using it anyway.