There is no need for insertion for it to work as a vibrator. As you well know, the most sensitive parts are on the outside, or very close to it, making it easy to stimulate without the risk of serious water damage.
When it comes to smell, I'd say that it might actually add to the thrill to use the phone in a normal way later on. To others, the user is just making a phone call, but in reality the user is enjoying the strong memories that the smell will induce while engaging in sexy taeme talk with the controlling user.