A lot of medical schools state that if you use AP credit for intro biology (or any intro class for that matter), then you need to take an upper level class to fulfill the requirement. So yeah that should work fine.
2) Most conditions affecting this policy revolve around AP credits
-Some schools will accept AP courses as fulfilling prereqs so long at the course/credit appears on your official college transcript with no additional work required, though it is often recommended
http://www.upstate.edu/com/admissions/faqs.php Do you accept Advanced Placement credits?
Yes, as long as you were awarded college credit and the course(s) are listed on an official transcript from your primary undergraduate institution. The Admissions Committee recommends that you also complete advanced science coursework in order to be competitive for admission.
http://sls.downstate.edu/admissions/com/requirements.html Do we accept AP credits for our prerequisites?
If your undergraduate college has awarded you AP credits and the credits are listed on your transcript, we will also accept your AP credits to fulfill our prerequisites if the course is listed by subject title on your final official college transcript. However, in order for the Admissions Committee to consider you to be competitive for admission, you should take advanced level science course work equivalent to the number of credit hours which have been accepted for AP prerequisites.
-Some schools will accept only certain AP courses (usually Bio and Physics) but not other courses
-Substituting upper level courses without having meet a stated condition for doing so, may not accepted by a particular medical school
-Prerequisites are typically not checked for fulfillment until after you have taken an offer of acceptance during the pre-matriculation phase
-Most schools have dates by which a course must be completed in order to matriculate. This used to be just immediately prior to medical school orientation but with classes beginning earlier and earlier, this date is becoming sooner in the cycle such as June 1 or even Jan 1. This prevents acceptees from completing a missing prereq in the summer prior to medical school
-Schools vary widely in their waiving or appealing the requirement, some being extremely strict and other being very open to substitution.
-In sum, it is up to you to know the school's requirements/policy and have fulfilled them prior to required dates. Schools can place you on deferral and even withdraw an acceptance for failing to do so