...problems [arising from involving colleagues] are inevitable, but you can alleviate them once you're aware of them, as well as warn the other stakeholders about them.
In any case, the downsides are far outweighed by the benefits of inviting colleagues and executives to observe as many user tests as they can.
Steve Krug says much the same thing in his books, and one thing from "Don't make me think" that really resonates with me is - getting colleagues to watch reduces the need for a 'big honking report'.
I've written a few of these in my time and the sad fact is, most don't get read. A bit like most website content really...
Involving stakeholders in user testing - article by Jakob Nielsen