There is a workaround for some food discounts- they will be applied if you mobile order from the account with the AP even if you haven't picked up your physical card. For non mobile-order food purchases and merchandise purchases the policy is that you have to show the physical card. As mentioned some people seem to be accepting the app but they're not supposed to and I wouldn't count on it.
Ticket booth lines typically aren't too bad near park closing though they often only have a couple windows open. Like the shops on Main Street, at least one ticket booth is open for 1 hour after park closing.
I got burned (literally- LOL) trying to pick up my DD14's pass after upgrading in the app when she was not present. It was very frustrating. I would make sure everyone is with you. I waited 45 min a line in the sun (hence the burned part

) while DD14 and her friends were at Pop Up Disney only to have the ticket booth CM refuse to give me her card because she "couldn't verify the photo" (which was in the system from the ticket I upgraded) without DD there. I had the app and receipts showing her pass (and mine) and I was not trying to change the name or photo or anything, just pick up the card. I had loads of photos of DD on my phone clearly showing she was my daughter. I still have not been able to figure out why this was necessary or what I could have been trying to "pull" with her not there. Then her expiration date got messed up when she did pick up her physical pass on our next visit (see my earlier post in this thread about that). So what could have been one visit to the booths to pick up the physical card turned into 3 visits and a total of probably 1.5hrs in ticket booth lines and headache since she wasn't with me when I first tried to pick the card up.