I know that the altitude readouts gathered by sites like flightaware and flightradar24 are not authoritative but if you look at the Youtube video, GPD235 never descended below their last assigned altitude of 2500'. While it appears they intercepted the wrong localizer, they did not start the approach and descend from the last assigned 2500' that was legal separation from an IFR target at 2000'.

Also if AA was following a TCAS RA, their Mode S enhanced transponder would might alert on the N90 controller's scope. (Edited to add: Maybe. I need to brush up on this. I get confused with what change 7.1 does vs. Enhanced Flight ID. I'm pretty sure that while aircraft with the latest implementation of TCAS II (7.1) and Mode S/Enhanced Flight ID are able to annunciate TCAS RAs to ATC, not all ATC is able to receive that annunciation?)

(Edited to edit to add: the guiding principle here being that ATC should not give a contrary instruction to an aircraft following a TCAS RA)

The vectoring of GPD235 right over AA on final for the parallel was certainly a curious move by the N90 controller working final but nothing indicates legal VFR from IFR separation was ever lost.