The author is right in saying that UpWork only guarantees payment when time tracking using their app. Where he is mistaken though is where he says that the app requires camera to be on at all times. There is such an option but personally I'd never go for a project like this. And yes, the app will take the screenshot of the stuff you are working on.
I don't get why author's customer would launch a dispute over not completing a 10 minute survey. Given that it was an hourly project I bet there were issues with communication and perhaps the author should have double checked with the client before closing the job.
UpWork is far from being flawless but for me it has been working quite ok.