It's the currently binding cylinder. With the right amount of tension applied via the wrench, one pin binds at a time, which is what allows you to set the pins one at a time.
What's the difference in feeling where he's 'testing' which one's the binding cylinder or not? Is it just a tiny bit more 'grainy' harder to push or something?
The binding pin won't bounce up and down when you actuate it with the pick. The non-binding pins won't offer any resistance at all. Also, when you manage to get the binding pin to the shear line, the tension wrench will sometimes give up a little more rotation.