I imagine the greatest concern is accidentally spelling confidential information during a training exercise, but that being said why are they allowed to have their phones while they train?

Beyond that there's tons of stuff China could do with mass video like this: running facial recognition, correlating social media accounts, and building up profiles and networks of US soldiers. Then down the line in maybe 3-5 years they've got a huge pool of individuals with security clearances to target for spear phishing and other cyber attacks.

ROTC is like any other class. Most lab sessions are going out and doing troop leading procedures in the woods. Most of the time, collecting everyone's phones and handing them back out would take up a third of the time you've got. Besides that, cadets use phones for the same thing everyone else does. Sometimes people need to get in contact with them in an emergency, sometimes they need to call their room-mate to tell them that when they left, there was a half eaten pizza they need to clean up, and sometimes someone gets lost in the sticks and having an easy way to call them saves everyone two hours of searching around in the woods. In most actual training exercises, like monthlong rotations in the national training center out in CA, and during your initial entry training, they will indeed take everyone's cell phones, but for the majority of training in the military it's not very practical.