It sounds like the pilots and hence the unions have an intent to hide things from the FAA. What's the significance of this report existing and why do they openly promote this "etiquette"?

Maybe the FAA should actually encourage neutral third-parties to observe pilots.

When everyone assumed it was the jump seat pilot that made the report to the FAA, of course the union would step in - at that point, the appearance is that one pilot outside of their (SWAPA) union is causing problems and taking things too far.

This is not something that even the jumpseat pilot bothered to report to the FAA, and is akin to somebody calling your CEO because you were late back from lunch to your desk job - the only way this outside party would know is if it impacted the company (or airline) very negatively. But when it's such a small thing, calling the FAA (or CEO) is using c4 to kill a mosquito: completely overkill.

If that happened to me, I would assume my (non-aviation) union would stick up for me as well