While I can't be certain, what you describe sounds like some variation on what's mentioned in the description of Techmoan's The Magnetic Tape Viewer - see the sound on a tape:
Q) You can buy these sheets of magnetic viewing paper that do the same thing.
A) They don’t have the same resolution or sensitivity - at least the ones I’ve bought don’t. They can’t show the magnetic signal and track layout on a tape. Nothing registered when I tried.
Given the next entry talks about how these were non-destructive alternatives to a liquid solution, I'm going to assume there would be no magnetic powder being placed on the tape beforehand.
Q) You can use this fluid stuff that does the same job
A) A few people are mentioning various ways to do this with a liquid smeared on the tape - These were known about - and likely made by 3M as well - but one reason for the development of the magnetic tape viewer was that it was a ‘non destructive’ way to read the tape - here’s an except from their patent application where they mention one of the existing and alternative methods to do the same thing.
“Heretofore magnetic signals recorded on magnetic tape have in a sense been rendered visible by smearing finely divided ferromagnetic material over the tape and allowing it to migrate to points of maximum magnetic flux. Besides being slow and messy this procedure involved the greater disadvantage that thorough cleaning of the recording medium was required to prevent the applied ferromagnetic material from supplying false signals. This procedure is treated in the television industry as unacceptable for the splicing of magnetic recording tape and splicing has instead been confined to tape areas in which the picture is blanked out.”
As for what they might have been checking for, a bit of advertising copy shown at 2:56 in the video says:
"Scotch" brand Model 600 can be used to check tape recorder head alignment, track placement, pulse definition, inter-block spacing and dropout areas in computer and instrumentation work.
