I think we need to hear why the school activated the webcam in the first place. The laptop was obviously not stolen. If it was reported as lost or stolen, then they aren't in the wrong for activating the webcam (except for that they didn't tell the user that it is possible.) Once they recognized the kid at the computer was the correct user, then they should have just turned off the webcam. No problems. The thing is, they saw what they thought was drugs (report) and disciplined the kid for it. That's where they went wrong, continued use of the webcam after they knew it wasn't stolen.
Now, they should have alerted the users to the fact that the webcams could be remotely accessed, and would only be in the event of a loss. Had they not taken a picture and reprimanded the kid for having "drugs," none of this would have happened.

In a Fox 29 report they referenced an older report from 2008, an interview with a district IT manager who talked about the software: LANRev http://www.lanrev.com/