However, did that evidence really exist? And if it did, was it for something else? Perhaps, the guy just worried about something far more mundane being discovered? We shall never know.
Think Schrodinger's password.
Courts have been fairly tolerant of law enforcement using pretexts like that to expand their powers.
That seems to be along the lines of what they're arguing here - they wanted to perform an ostensibly legal search, and he destroyed everything that might have been evidence either way. It would be like a corporation getting an e-mail from the SEC saying "Give us all the communications your company has had about these three stocks" and the company saying "Oops someone erased our e-mail server so I guess we don't have any communications about that."
If you're this paranoid about being searched, or you have something to hide (even if that 'something' is a sense of morality and a desire for a free and just society), wipe your phone before you cross the border and not during. Put some basic apps on (reddit, twitter, etc), leave them logged out or put them on some empty account and tell them you're not a big social media guy or you're on a digital cleanse or something. Wiping your phone when you're being detained by law enforcement is a bad look one way or the other.
I agree that it's legally irrelevant, but we've seen many court rulings lately where legally relevant things are ignored (e.g. 'the president is immune to any legal repercussions from committing crimes') so given the current political climate I think 'bad look' is still relevant in practice.