Is there a regulation on holding someone longer in Korea if they start the ACAPing process?

Yep it's true.

You should speak with the Soldier For Life Transition Assistance Program personnel and find out the validity of this claim. They should be able to readily cite the regulations and policies regarding a Soldier's tour extension related to transition should one exist. The S-1 should also be able to assist with this question since it is an administrative function.

Before the army started separating SM from Korea. You would stay in Korea then PCS'ed state side to ACAP even if it took you past your ETS. forcing you to extend your contract.

Yes,, true! You have been deployed! That means you stay, until the Army say you go! My ETS date was extended a couple of times due to deployments, and needs of the Army. Of course there are always extenuating circumstances.

This is correct. The Army will not PCS you if you have less than a year remaining on your contract.

It depends on the time remaining on their contract. When I first got to Korea I was planning on ETSing, but I had 13 months left in the service. Had I ETSed, I would have had to stay in Korea past the one year mark. I don't remember the time I needed to have left to DEROS back for ETS.