It usually takes one paddle flip for the Disable Local Control to kick in, so it sounds like that’s what you did. You should also turn on Smart Bulb Mode to insure the dimmer’s output is always at full power.
Disable Local Control only stops power from being cut by pressing the paddles on the switch. You can still control the switch from the app and cut the power there. That’s expected. If you don’t want the app to be able to control the switch, then Disable REMOTE Control.
So it sounds like it’s working as expected.
Can’t answer your Hubitat questions.