Put tape over it. The webcam light is a security feature that lets you know when an application is using your webcam. Bypassing this feature would allow someone to watch you via your webcam, with out you knowing. Or worse, you forgot to close a meeting/streaming session and didnt notice the light is on.
There is a lot of malware based on turning off webcam lights, but leaving the webcam on.
I will say it sounds like a terrible design if the webcam light is impacting the video quality.
I have trouble believing System76 tests their builds before selling them