Earlier quoted context omitted.
It's such an obvious solution that I really thought that WAS the case until just now. Why in the world would you tackle this problem any other way?
They basically did, the light can only be turned off when the USB signals "standby". The hack is to override the camera to ignore that signal. It is a rather unique idea and probably not something anyone even considered at Apple.
-- A LED shall light up when the camera is activated.
But what they should have implemented is:
-- It shall not be possible to activate the camera without the LED being lit, taking malicious third-party software into account.
The first requirement is obviously, and demonstrably, implemented by every camera (ignoring hardware defects regarding the LED). The second is, as proven by the paper, not fulfilled by any.
{EDIT: added the malicious part to the 2nd requirement}