The Delightful Children from Down the Lane used this device so they could get all the presents they want and give every other children in the world coal, since they always get coal every year for being evil. However, because of their greed, the machine over-powers them and they succumb to being growing green fur on their faces, similar to the Grinch. They begged Sector V to help them, which Sector V willingly did.
Numbuh 3 also used the Reindeer System near the end of the episode. She initially wanted to use it to give all of her friends even more presents than she had before, but that desire became tainted with having this power. She became angry that her fellow operatives in Sector V had not gotten her presents for Christmas, yet she had bought presents for all of them. She believed that since she was happy, cheerful, and kind all year to everyone, she deserved all the presents in the world, and singled herself out on the system as the Delightful Children had. Numbuh 3 became green and hideous looking, similar to the Grinch, because of the power. Under Santa's orders, Numbuh 4 reluctantly gave her a present of leftover fries from the Rusty Burger. Realizing that another person cared enough to give her a Christmas gift, especially from Numbuh 4, she returned to her normal self and thanked Numbuh 4 for the thoughtful gift; even if it was the only gift he's ever given her.