I have observed through a one way window and been in a room taking notes, and in all cases the families have been aware and it hasn't made much difference - some people make more effort or try to make eye contact with you to see how they're doing when you're in the room, and some people forget you're around and just get on with it. Others just don't have the wherewithall to be able to play and interact in any constructive way with their children, and a trained and experienced professional will take all these variables into account. It depends where the contact is taking place and if a room with one way window is available, too. The best experiences I have observed have been in NSPCC offices, where the public areas and children's room are so child-friendly that families can ease in to the situation. Contact and Sure Start centres usually have relaxing surroundings, too.
I thought the guardian who observed the father and child in the programme was the most experienced of those who appeared, but the resources that were offered to that family were inappropriate and they should have been given other opportunties, and as has been previously mentioned, not a 'to do' list. A family worker to show them how to do things like play, clean, make rooms safe and tidy up, as well as use of appropriate language and discipline, would have been more helpful - ideally in a day or residential family centre as well as the family home. That wasn't shown, and I don't know if it was offered. I'll be interested to watch the next programes now.
I have played with my children whilst someone was observing and taking notes, so I know what it feels like. We did this for some research when my twin daughters were two, as part of some twins research at Manchester University. It did feel onerous because, despite the researcher telling me there was no pressure, I was anticipating one child having a temper tantrum, which she did frequently then, and the other child would have leapt on my knee to ensure her crying sister didn't bag the best spot first! Families do need to have the opportunity to be observed more than once to get any meaningful information.