I imagine that the Lenovo Settings app is just a front end to settings that manufacturer's shouldn't write bad software to fuss with in the first place. You can check in the Bios just to see if there are any oddball settings that affect the camera, heaven only knows which settings Lenovo has decided to toy with (could be a power or power-savings setting, or an "enable" setting).... I also suspect that it might toggle some of the settings in the Windows 10 on and off (you get to decide which apps use the camera, the Lenovo app might toggle these on and off).
I would be surprised if removing the Lenovo app would cause the camera to stay in "Privacy Mode" forever. I expect that going into the settings in Skype, in Windows 10, and in the Bios, would sort things out - and permanently.
If you haven't already, and you want to keep using Lenovo's bad work, try making sure to update to the latest versions of Skype, the Lenovo Settings app, the Lenovo driver for the camera, and the Bios of the motherboard as well. Somewhere in all that tangle might be an update that causes OFF to actually mean off.
Here's a thread that suggests the update route ... it might actually have worked:
Solved: Integrated webcam not found/working B5-7 - Lenovo Community
I really wish manufacturer's would stick to making good hardware, and let the software houses make decent software. But I won't rag on Lenovo too much, HP and ASUS write pretty awful software too (sadly, terrible drivers all too often) ... ... and, truthfully, I like several of the latest Lenovo laptop designs ...
Let us know if none of the above helps
