Your strength as a rationalist is your ability to be more confused by fiction than by reality. If you are equally good at explaining any outcome, you have zero knowledgeIn other words, if I give a phenomenon for you to explain, you should be better at explaining it when it is a real phenomenon, and more confused when it's something I just made up. (See the Less Wrong post for an example.)
I might quibble a bit with Yudkowski, since I don't think it's a test of your strength as a rationalist exactly. I think it's a test of how good you are at making predictions about reality.
If, for instance, you know something about the way eggs behave, and I told you that my carton of eggs had some liquid dripping out of it after bringing it home from the grocery store, you might explain it by saying one of the eggs broke. If my story was a lie, but you weren't confused by it, that's okay. That just means you're unable to predict whether a particular egg will break or not (though you are able to predict what happens when an egg breaks). Similarly, any time you fail to be confused by fiction, that represents something you are unable to predict (or bad at predicting) about reality.
In Harry Potter and the Methods of Rationality, hyper-rational!Harry uses "noticing confusion" in a particular way. When Harry Potter encounters a particular story that doesn't fit into his worldview, he says "I notice that I am confused." This is open acknowledgement that he has either made a wrong prediction based on a flawed worldview, or the story is wrong.
This seems like a useful practice since cognitive biases tend to prevent us from recognizing any flaws in our own worldviews. But we get confused a lot, so it's good to remind ourselves that this often means our worldviews need correction.