ok, just to be sure we are talking about the same thing - a hall effect
sensor uses a semiconductor material, and the magnetic field changes
the current flow through the semiconductor.  Most are monolithic
circuits, and include an amplifer and typically a schmidt trigger to
provide a logic output.  A hall effect sensor itself will never have a
magnet as part of the sensor - you find these sensors in your hard
drive and floppy drive motors (on all the newer drives).  According to
my service manual, these sensors are coils of wire (and I've taken one
apart when I mooshed it doing something stupid, so I know that it's
really a coil of wire.

I'm not trying to be argumentative, just accurate.  you may well have a
coil of wire with a magnet - then when a piece of iron passes nearby
(5mm if you remember the spec), it will change the coupled field
through the coil and induce a current/voltage which the DME can detect.

You can read about hall effect here:
http://www.answers.com/topic/hall-effect
quoting, it says:
The Hall effect refers to the potential difference (Hall voltage) on
opposite sides of a thin sheet of conducting or semiconducting material
in the form of a 'Hall bar' or a van der Pauw element through which an
electric current is flowing, created by a magnetic field applied
perpendicular to the Hall element. The ratio of the voltage created to
the amount of current is known as the Hall resistance, and is a
characteristic of the material in the element. Dr. Edwin Hall
discovered this effect in 1879.

Analysis

The Hall effect comes about due to the nature of the current flow in
the conductor. Current consists of many small charge-carrying
"particles" (typically electrons) which see a force due to the magnetic
field. Some of these charge elements end up forced to the sides of the
conductors, where they create a pool of net charge. This is only
notable in larger conductors where the separation between the two sides
is large enough.

One important feature of the Hall effect is that it differentiates
between positive charges moving in one direction and negative charges
moving in the opposite. The Hall effect offered the first real proof
that electric currents in metals are carried by moving electrons, not
by protons. Interestingly enough, the Hall effect also showed that in
some substances (especially semiconductors), it is more appropriate to
think of the current as positive "holes" moving rather than negative
electrons.