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Mainly they were looking to take more damage so as to take more heals and regenerate mana from the healing.
I'll try to answer this for you. The thing about pally tanks is that the way they generate threat is through their spells, and to do that they need mana. Just like Warriors need to be hit to generate rage, pallies need to be overhealed to generate mana.
I never shield the tank (paladins "bubble," we "shield" ). Paladins don't like it for the reasons you mention, warriors and druids don't like it because of rage generation. I may throw a shield on a DPS who's taking unavoidable damage, but that's about it. This applies to regular 5-mans though, I am not experienced with healing at higher levels and I'm sure there's stuff going on up there that I don't know about.
It’s worth noting that Paly tanks no longer get any benefit to their mana from overheals. They only benefit from healing done.
As fluffydragon stated, Paladins do not gain mana from overheals, this means that Paladins gain mana equal to 10% of the damage they are taking,
I'm sure that blocks are determined before PW:S, so his Holy Shield threat shouldn't be affected. And I'm pretty sure that damage absorbed still counts for Retribution Aura, but I've never tested it. Ok guys, here's the dl from a pally tank.
Addressing damage, healing and mana for a pally tank.
Yes, we like to take damage so that we need heals so to regen our mana. No, overheals don't help, we only gain mana for acutal heath healed.
No we don't like PWS. Yes we do like it when we are low on health and you NEED to hit us up with one for heal reasons, but by then if your pally tank doesn't have agro, he sucks.
PWS (as far as I know) stops people from hitting you. Though I also have never tested it and really would like to know the answer. Actually I'm going to hit up the fellas on the pally forms and get an answer... so I'll get back to you. Based on the knowlage that I have, it stops threat build. Holy Shield, Blessing of Santuary, Ret Aura all help us keep our agro. A PWS before the pull is ok, as our main agro gain at that point will be Avenger's Shield, or Conceration. But don't be suprised if your Pally Tank waits till there is only 8 to 10 sec left on the Shield.
Personally, I think your pally tank was burning his mana too hard, or not drinking before a pull with low mana. He should try using a lower rank Conceration and Holy Shield. Or maybe back off his Conceration (as I only spam it once at the begining of a pull, maybe twice if I see my agro dropping via Omen further in the battle). He was right in that we don't like bubbles... again for Holy Shield, Blessing of Santuary, Ret Aura.
From a priest's pov (yes I have a lvl 68 holy)... I really only use Flash Heal, Renew, Prayer of Healing, and that one that bounces (yeah... I can't remember it atm). I PWS my dps guys when they drop below 65% and renew them so I can get back to my tank. When I know for sure I have time (eg, tank is at 40% and the rest of the group is above 70%) I'll use a Greater Heal. I can heal a pally tank through Black Morass (basically a timed endurance run) with no problem, drinking after each boss (portals 6/18, 12/18) and a pot around the 10th portal. I've only healed 5 man runs, but really... I've been able to keep up with a over zelous Shammy, a crit happy Rogue and a Druid tank using the above said spells (and we know how they can all pull agro so well).
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Priests depend on cheating the 5 second rule just as much as he depends on heals for mana regeneration.
Sorry, what is the 5 second rule? Never heard it before.
Good Luck.