Phantom or real voltage determination
Well, it will work IF the poor connection is not capable of passing 0.35A...

You don't get "phantom" readings of 120V, it's either 120V or it is not. But what you can get is a bad CONNECTION on a 120V circuit so that as soon as the load starts to pull any appreciable current, that connection increases in resistance and the voltage drops to where it can't even make your 25W lamp glow. 350mA is not a lot of current and it may end up not causing that voltage drop, so it will still "look" good, but it really is not.