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Question regarding (Insurance-based) Tenancy Deposit Schemes

A colleague is in dispute with an ex landlord regarding damage to a
carpet in a room. The deposit is protected by Mydesposits and my
understanding is that it is an insurance based scheme. A dispute has not
yet been lodged but will be soon. A couple of questions:

1. The total deposit was 500. The landlord is wanting 80 to replace a
carpet. If a dispute is lodged I understand that 'the disputed amount is
handed to the TDS'. Does this mean that the tenant should receive the
undisuputed amount (i.e. 420) within a reasonable time (presumably 10 days)?

2. Due to unrelated issues with the tenancy (general poor state of
repair of the property, unproffessional behaviour by the landlord e.g.
failure to repair outstanding faults, entering the property for
non-emergency reasons without notice etc.), there is a suspicion that if
the landlord retains the 80 pounds that it won't be used to replace the
carpet. My colleague is still in contact with current tenants so would
be able to determine whether the carpet has been replaced. Would there
be a reasonably time within which this should be done, and if not would
it be possible to recover the amount through a claim in the small claims
track?

3. The damage looks like slight scorching of a small area of carpet. The
landlord is claiming this was from hair straighteners. My colleague
disputes that she caused this. There was no inventory signed either at
the start or end of the tenancy. The property is in a generally poor
state of repair. The landlord is claiming 80 pounds for complete
replacement of the carpet (which sounds like a reasonable amount for a
lowish quality material). My colleague doesn't think replacement of the
carpet is warranted given the general state of the property. I assume
the Dispute Resolution Service would be deciding on the balance of
probabilities whether the tenant is responsible, and whether complete
replacement is appropriate.

4. I have given my opinion that my colleague should stick to the facts
of the specific issue, rather than bringing in any of the other issues
regarding the general behaviour of the landlord. Would this be correct?
If comment on their behaviour would be useful information for the
Dispute Resolution Service it is possible my colleague could obtain
statements from current (and past) tenants.

Thanks in advance.

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