First off, thank you all so much for the comments. I went out of that situation mad at him and myself somewhat, wondering if I should have just kept my trap shut and let him take the damn photo. Thank you guys for backing me up when I said I didn't want to, and letting me know that he was indeed over the line demanding the photo against my will and not explaining to me WHY.
Some of you were worried I wouldn't get care at all. I assure you that was never the case, I knew I'd be able to find another doctor the next day, but we didn't get home til about 8:30pm, so I couldn't go anywhere right after the issue.
My mother woke me up this morning, saying she had decided to look up a doctor we liked who left that practice and found he had moved to a place we pass in front of all the time. She asked ahead if he'd force me to take a picture, and they said no.
He was excellent, diagnosed my infection and gave me antibiotics. He even let me have the nasal spray for my flu symptoms on sample, and let my mother have some albuterol samples for her asthma. ^__^ I did discuss what happened at his former colleague's place, and he confirmed what the other doctor didn't say, and what you all told me: it is a practice to prevent insurance fraud. His place uses it too after he was defrauded and investigated, but he wouldn't force me or deny me my treatment because of me saying no.
He did seem concerned (again, as did you guys) about me being able to see the thumbnails of other patients. I told him that I don't believe it counts as a code violation per se. I only saw headshots with no other data, and I do have to see your whole body if you're in the waiting room anyway. I have a feeling its no more harmless than that.
However, I later decided to call the NYC hotline on Monday and try to talk to someone who knows about such things, and run it by them. Let someone more schooled in it figure out if I should formally complain or not.
(Not that I received good service from 311 even when I was a city employee, but that was ages ago. XD)
Thank you all again for your advice and encouragement, I really needed it. <3