I'm 5'8", 145 lbs now.
My forearms, biceps, shoulders, legs, and chest are barely pinchable...but I've got a good half inch to inch around my sides/stomach that could go.
I spoke with my instructor, and he figures that the machine calculates TOTAL body fat %. i.e. I may be 12% around my sides, but 3% everywhere else...hence, I'm 5% overall.