
merpius |
I believe all of the relevant text follows.
Given all that it appears that it is incorporeal for anyone except the phantom blade himself, since that clause is the last part of a sentence describing what happens with other people.
For the phantom blade themselves, since it has ghost touch, regardless of whether it is incorporeal or not, it affects both corporeal and incorporeal things equally; it, effectively, exists on both the Prime and Ethereal plane (or similar, depending on the particulars of the cosmology in your game).
Presumably, since it is incorporeal for anyone else, it could be wielded by incorporeal creatures (other than the phantom blade), but only against other incorporeal creatures, and would not have any special abilities or such for that creature.
I suppose you could say that it ignores (corporeal) armor and shields, but it would also ignore (corporeal) targets wearing such things.
A phantom blade begins play with an ectoplasmic sentient weapon known as a phantom weapon whose weapon type is chosen by the phantom blade. The weapon type must be one with which the phantom blade is proficient. A phantom weapon functions similarly to the black blade of the bladebound magus archetype except as noted on the Phantom Weapon Progression table. A phantom blade with this class feature can’t have a phantom of any kind, even from another class.
This replaces phantom, phantom recall, spiritual bond, and dual bond.
A phantom weapon has special abilities (or imparts abilities to its wielder) depending on the wielder’s spiritualist level. These abilities are cumulative. A phantom weapon normally refuses to use any of its abilities when wielded by anyone other than its phantom blade, and acts as an incorporeal masterwork weapon of its type.
A phantom weapon is always treated as a ghost touch weapon, regardless of weapon type or any other abilities modifying the weapon. If the phantom weapon would ever be destroyed, it is instead harbored in the spiritualist’s consciousness for 24 hours.

ErichAD |

The only reference I know of to incorporeal objects of any kind is in the ghost template.
When a ghost is created, it retains incorporeal “copies” of any items that it particularly valued in life (provided the originals are not in another creature’s possession). The equipment works normally for the ghost but passes harmlessly through material objects or creatures. A weapon of +1 or better magical enhancement, however, can harm material creatures, but any such attack deals only half as much damage (50%) unless it is a ghost touch weapon. A ghost can use shields or armor only if they have the ghost touch quality.
If the ghost touch quality makes it so that the weapon can no longer pass through walls, then I suppose a ghost with a ghost touch weapon would need to use the door. If the "both corporeal and incorporeal" aspect of ghost touch only impacts how it interacts with creatures, then you can probably ignore cover, I don't know about armor and shields though.
It's odd that they'd leave the "incorporeal" term in the weapon's description if it isn't really incorporeal in any sense.