I am sure your unemployment claim will be upheld, eventually. It sounds like the employer is starting trouble. A contract ending is lack of work. Hopefully, NYS will investigate quickly so you can resume benefits.
As for collecting unemployment while working on a showcase or under 1099 work, that is NOT legal. You need to be available for work every day. Each day you work, whether paid or not, you lose 25% of your unemployment benefits for the week. Also, any money you earn, whether they send you a 1099 or not, is taxable. That being said, many people still do collect unemployment while doing showcases or 1099 work. Just be aware that it is not legal, and there are potential ramifications.
Allison