Other mistake: When McNulty uses the stopwatch to rob a bank, he goes through a small wooden door and past the employees. With time frozen, the small door should have stayed open but immediately swings shut.
Factual error: When McNulty clicks his stopwatch the helicopter is shown frozen in flight but the blades are shown as a blur, they should be just as much in focus as the rest of the helicopter.
Revealing mistake: When McNulty clicks the stopwatch, you can see numerous times people still moving slightly even after time stops, most notably the waiter serving coffee and doughnuts.
Continuity mistake: After McNulty freezes the office, a co-worker is getting water from a faucet, and the water is frozen in motion, but right before McNulty unfreezes the office, a female co-worker is in the background at the faucet with no water coming out of the faucet.
Answer: It's explained in the episode. The aliens are experimenting to see how humans react to various scenarios. This just happens to involve them using super strength.
Thanks. It's been a long time since I saw the episode so I forgot.