Quoted from Jasontaps:Watch some of the videos on youtube. Each cabinet is connected to a temporary head and every function is tested.
Bought a HUO LOTR. I noticed that several LED's in the "Man" "Dwarf" "Elf" ring indicator above the flippers were not working. Started checking around and found a wire in the head that was loose. I determined it should have been inserted to a IDC connector. Looking at the wire it was pristine, there were no marks indicating it had been previously inserted into the connector (as the connector cuts the insulation it is pretty obvious). So Stern clearly missed the fact that multiple LED's were out on this machine because they never worked until I put the wire into the connector.
I understand that mistakes are made (wire missed) but a comprehensive check should have easily caught this issue. Overall I think they do a pretty reasonable job for the complexity that is a pinball machine, just pointing out they are not verifying every function (at least they were not in 2003).