No, if it goes to plan then you have confirmed the student knows the emergency and how to handle it - that is a big plus as far as I am concerned and you can praise him for it. If he messes it up (providing it is one he has been shown/practised before) then you make a learning point from it, highlight the indications/actions/remedy and then he has learned something - he has learned/relearned that one which he might not have fully understood before.
In each case the student learns - that is surely the point of the job of an instructor.
The only negative way of handling it is if you berate him for messing up the emergency and then make a big show of how clever you are at demonstrating the right way of doing it - that is negative teaching but it amazes me how many instructors don't seem to be able to tell the difference between instructing and destructing.
Yes if it goes to plan then of course you and he know he can do it. But that info seems pretty useless if, as was the case here, it is a bit of a one-off training flight. I would imagine that H500 was never going to be the PPL's CPL examiner and in fact probably, never fly with him again. So as I said, if he had done it correctly then the time was wasted. However since it seems H500 had a pretty good idea of the guy's likely competence beforehand, to not brief properly on what was to be done in flight was "setting him up to fail". Perhaps H500's agenda was to make the chap realise he should give up the aim of becoming a commercial pilot?
To randomly pick on something during a training flight with a pilot you're not familiar with, and then when you find the pilot can't cope, to attempt to rebrief in flight, is a really bad way to instruct. I hope you know this really and are just arguing with me for the sake of it. If not, you need refresher training on how to be a competent instructor.