brotherbobby said:
Could it not be that the increase in the angular speed (ω2>ω1\omega_2 > \omega_1) is exactly offset by a decrease in the radius (r2<r1r_2 < r_1) so that the speed (v=ωrv = \omega r) remains constant?
It could be in some situations, but I don't believe that's the case here. Also it's not necessary.
Let's focus on the dumbbells. Let's take a simpler system which consists of two rotating dumbbells held to the center by massless rods (or, alternately, "consider a massless professor" [1]). So all the mass is in the dumbbells. Let's start the system rotating with radius ##r_1##.
The moment of inertia of this system is ##2mr_1^2## where ##m## is the mass of one dumbbell. The angular momentum is ##I \omega_1 = 2mr_1^2\omega_1##.
Now pull the dumbbells into radius ##r_2##. The new momentum of inertia is ##2mr_2^2##. Angular momentum is conserved, so ##2mr_1^2\omega_1 = 2mr_2^2\omega_2## or ##(r_1/r_2)^2 = \omega_2/\omega_1##. And ##v_2/v_1 = (r_2\omega_2)/(r_1\omega_1)## ##= r_1/r_2##. The linear velocity is in inverse proportion to the radius.
Note that for the professor with mass, who is carrying some of the moment of inertia, that proportion won't hold. But any way, the linear velocity is definitely not constant. For the massless professor, the dumbbells have higher linear as well as angular velocity.
How can that be? Remember, this is a rotating system. The dumbbell in his right hand is now moving faster. But the dumbbell in his left hand is now moving faster in the opposite direction, at all times. Their total linear momentum at all times is zero, just as it was before.
[1] There's an old joke about "consider a spherical cow". You can take it either as a physics joke, or making fun of physicists and their approximations.