The phrase 'penis-melting Zionist robot combs,' while not widely known, does seem to be growing in popularity. The phrase refers to a mass panic that swept through Khartoum, the capital of Sudan, in September 2003. The people of Khartoum feared that a Satanic foreigner was going around shaking hands with Sudanese men and thereby causing their penises to melt upwards inside their body. In one case a man reported that he was approached by a stranger at the market. The stranger handed him a comb and asked him to comb his hair. "When he did so, within seconds... he felt a strange sensation and discovered that he had lost his penis." The Sudanese journalist Ja'far Abbas interjected a note of scientific rationality into the growing hysteria by making this observation in his column in the Saudi daily Al-Watan:

No doubt, this comb was a laser-controlled surgical robot that penetrates the skull [and passes] to the lower body and emasculates a man!!
I wanted to tell that man who fell victim to the electronic comb: 'You jackass, how can you put a comb from a man you don't know to your head, while even relatives avoid using the same comb?!' ... That man [i.e. the mysterious stranger], who, as it is claimed, is from West Africa, is an imperialist Zionist agent that was sent to prevent our people from procreating and multiplying.

James Taranto wrote about this case of mass hysteria in the Wall Street Journal's Best of the Web Today column (October 2003), and he's credited with the first use of the phrase 'penis-melting zionist robot combs' (although I can't actually see where in the article he uses that specific phrase). I think people mostly just like repeating the phrase because it sounds cool, but I guess it could also be used to refer to any instance of extreme gullibility. For instance, one might say to a friend, 'that's a rather penis-melting-zionist-robot-comb-like belief you hold.'

Incidentally, shrinking-penis fears are centuries old, and there's even a term to describe them: Koro, or (more scientifically) 'genital retraction syndrome.'
Timothy Hall has an interesting analysis of this syndrome on his UCSD webpage.