Decorating the bands doesn't interfere with the RFID. We were there for two weeks last month, and had a total of six bands that had been painted with acryllics or nail polish. DD15 even blinged one of her bands out, with crystals all over/around the Mickey head, and it was fine. (Actually, it kinda helped her line up the "Mickey to Mickey" at the readers.)
For TONS of information and ideas on decorating your bands, check out this 166-page thread:
http://www.disboards.com/threads/ha...ic-bands-please-show-us-the-pictures.3190181/