That appears to be using nslookup (edit-"esq") to see if the domain resolves as a result of a test that I just ran. (Tried a name not in the zone file that IS taken (4L .com) - edit: it said it was available. Then tried a name that wasn't in the zone file and it took some time to determine if it was available. If it was comparing to the zone file there would be essentially no delay it would be a simple search. If I wanted to prove this I could register a name NOW, do the dns, and then do a query but I don't have time to do that. The zone file is only available once per day for download.
Also, it doesn't work for anything other than .com.
And if you hit "search" it sends you to godaddy.
All in all I think it makes more sense to simply find a dns server that you can trust OR get a hold of the zone file and query that (safest way actually). My personal feeling though is that this is all a non-issue.
