For those confused, it's worth noting the difference between observed as a layman concept and as a quantum mechanical one.

In QM, to observed is to couple the observer to the "system" being observed. Think of it like "observing" your neighbour, over a fence using a BB gun. When you hit flesh, you know where your neighbour is. Unfortunately, the system has now been fundamentally changed. In a classical system, you could turn down the power, until your neighbour doesn't notice the hits. Unfortunately, QM imposes fundamental limits on your measurements (heisenburg and his uncertainty principal). In order to observe your neighbour accurately, you need to hit them hard enough that the will also feel it and react differently.

QM behaves in a similar way. Initially, the system is just a single particle, and is not very restrained. This allows it to behave in a very wave like manner. When you observe it, the system now includes the whole observation system, as this coupling propagates, more and more atoms etc get linked. The various restraints cause an effect called decoherence. The system behaves ever more like a classical physical system.

In short, a quantum mechanical "observer" is less sneaky watching, and more hosing down with a machine gun and watching the ricochets.