I didn't see the quote you did but he probably confused the fact that PHM used physical elements in place of some CGI in certain scenes and the separate fact that a realistic physical puppet was used on set for reference. Some parts of that puppet are seen on-screen in some shots but most of the creature in most shots was CGI or CG enhanced (which looked great thanks to the ideal in-camera puppet reference it replaced). I explained more here: https://news.ycombinator.com/item?id=48198851
PHM did use real sets (like most movies) and they were able to avoid using green screen for some of the ship exteriors but the backgrounds were still digitally replaced with CGI rendered elements, they just didn't use green screen to pull the matte. Instead they used a black backdrop with careful lighting and some hand rotoscoping to extract the digital mattes. Doing it this way had the advantage of not needing to digitally remove green spill on reflective surfaces by hand and it saved money over doing a StageCraft volume at that size. Done well, green screen would have produced the exact same shot but it would have cost more and taken longer.
About the puppet: A real Rocky puppet was indeed used on set and some of the puppet is sometimes seen on camera. But most of the puppet was digitally replaced or enhanced in most of the scenes. However, using a much more realistic puppet on set was a notable technique but not because the character wasn't CGI. The puppet IS worth talking about because it directly enabled the final mostly CGI character be really good CGI. It's so good because it gives the VFX character animators an ideal reference that's "grounded" in the physical reality of the set. The subtle interplay of light, shadow, texture and specularity are all physically grounded. It also gives actors something closer to reality to interact with. It's a wonderful technique and should be celebrated instead of obfuscated to promote a falsehood that trends well on social media.
But influencers and media are perpetuating "No CGI" myths without realizing it instead of focusing on the actually interesting, more nuanced reality. The same movies you hear these "No/little CGI" claims about actually have tons of digital VFX, they're just good VFX. And they're usually good because what these films are doing is providing extended environments and plates which help the CGI be "grounded" in reality.
Similar "careful wording" grew into outright lies around Top Gun. Tom Cruise truthfully said in interviews that he was flown in a jet right alongside other REAL jets doing simulated dog-fighting. The lost nuance is that all the other jets Cruise flew with those dog fight scenes were Soviet trainer jets that are pretty small and look quite different than real MIGs. So exactly zero pixels of those jets are ever seen in the final film. They were entirely replaced by CGI jets. And you couldn't tell because the weird-looking trainer jets provided grounded reference for the CGI. Just about the only recent mainstream release that can reasonably claim "no CGI" is Nolan's Oppenheimer (it's not quite fully true but it depends on technical definitions). But every film I've seen social media "No CGI" hype around is chock full of hundreds of CGI shots. So let's just celebrate using grounded on-set and in-camera references to assist rendering outstanding, realistic CGI because it's great work by talented people.