I even reconfigured one of my rigs so I can wear a weight belt, which I normally don't wear. It's only 4 lbs, but it meets the requirement of having something to ditch.
That's ridiculous. One of the most common errors students and beginners make is using too much weight, or assuming that everyone needs the same weight. Wearing no weight sets a positive example in numerous ways. If you're acting as victim for unconscious diver rescue practice, wear one with no weight, or use it as a teachable moment to show that they may not always encounter a weight belt.
I understand why an OW instructor might object. First of all, it could be a distraction. The class isn't there to learn about your gear or the way you dive. They also aren't there to boost your ego because of how cool you and your gear are.
You make some grand assumptions about his motives. As for the distraction, if they're that easily distracted, they need to be institutionalized.
They are the instructors or shop owner's customers, not yours. Sorry, but if you have such a problem with wearing standard recreational gear, then you shouldn't be working as a recreational DM.
No, he shouldn't be working for THAT instructor. The instructor is a jerk, but you're correct that, as the boss, it's his prerogative to be a jerk if he wishes.