I've have now heard Lloyd's "Sally Brown" (thanks to a friend) and it's as I was suspecting: the unusual melody that Lloyd was being called out on was simply the one prominent collected version that differs a good degree from others. This was a rendition sung by ex-sailor Charles Robbins, age 66, in 1908 to Cecil Sharp. Sharp first presented it in a journal article, then included it in his big chanty collection of 1914. Here is me singing it, so that one can hear the melody notated by Sharp:
"Sally Brown" of Robbins

My working hypothesis is that the unusual sound of this melody -- in which some degrees of the scale are sometimes major, sometimes minor -- reflected the phenomenon of blue notes. Sharp, as far as I know, did not have "blue notes" in his frame of reference. He merely made an effort to notated what he'd heard within the categories of his musical system. To his credit, he did try to notate the melodies rather precisely, whereas other collectors might "normalize" them. I think what happened in this and some other chanties that were collected is that neutrally-pitch or blue notes were sung, after which the collector, out of necessity, forced these notes into major or minor. When one (e.g. Lloyd) then goes to read the notation, one realizes the reified categories of the collector. Anyway...

Hugill is claimed to have said, in the above quoted passage,

Bert did 'Sally Brown' but not the normal version, not the way any sailor ever did it.

He was essentially incorrect; Bert sang it as the sailor Robbins, albeit rendered from notation, but a notation that was more accurate than Hugill's, FWIW. OK, so it sounded weird to Hugill, and we can understand why.

What irks me, however, is that Hugill reproduced, verbatim, the Robbins variation of "Sally Brown" in his book! He didn't even know it was there, I guess (since he seems not to have been able to read music, and just threw it in there with a vague idea of what it was like). And you know what? The album on which Lloyd sang this was one that was created after Hugill's book came out and which clearly utilized Hugill's book for some things. Lloyd may even have got this "Sally Brown" right out of Hugill's book.