Benefits & Rulings:

Although this narration is weak in terms of its chain of transmission, other authentic narrations establish the prohibition of exposing one's private parts to each other and engaging in conversation while relieving oneself.

For instance, there is a Hadith: “A man should not look at the private parts of another man, and a woman should not look at the private parts of another woman.” [Ṣaḥīḥ Muslim, Kitāb al-Ḥayḍ, Hadith: 338]

Another Hadith mentions: “A man passed by the Messenger of Allah (ﷺ) while he was urinating, and greeted him with peace, but the Prophet (ﷺ) did not respond to the greeting.” [Ṣaḥīḥ Muslim, Kitāb al-Ḥayḍ, Hadith: 370]

Although replying to a greeting is obligatory, the Prophet (ﷺ) still did not respond. This indicates that if responding to a greeting is disliked during such a state, how could engaging in other forms of conversation be permissible?

It is likely due to this reason that some scholars have declared the Hadith under discussion from Sunan Abū Dāwūd to be “ṣaḥīḥ li-ghayrih” (authentic due to supporting narrations). See: Al-Mawsūʿah al-Ḥadīthiyyah, Musnad al-Imām Aḥmad, vol. 17, Hadith: 11310; Ṣaḥīḥ al-Targhīb, 1/175.