Does disabling apparmor systemwide have security implications? Is there a application based alternative?
Disabling apparmor for "debugging" as in this case is not an unusual step. The apparmor website mentions:
Debugging application problems
When debugging issues, the first step should always be to disable the AppArmor profile
The arch wiki (since you're running arch) mentions:
AppArmor, like most other LSMs, supplements rather than replaces the default Discretionary Access Control (DAC). As such it is impossible to grant a process more privileges than it had in the first place.
LSM = linux security module.
Apparmor is basically a categorisation or labelling system for the files in an installation with a set of rules about which files can access other files. It protects against bad software that wants to access stuff it doesn't need or shouldn't. It's a security system that sits on top of the already robust secure system of permissions that is inherent in the standard linux filesystem (the DAC). For debugging, turning apparmor off for an application or the system is pretty common. Apparmor is not a firewall.
In debugging, it's not a bad idea to try one thing at a time so see if it affects anything, then after the trial, return the system to it's original state and try the next thing.
The other thing that comes to mind about the problem is to ensure that the nvidia installation is correct in all respects. It's possible to clear the graphics system of the nvidia software, and run the open source nouveau driver (which nvidia blacklists). If the system runs properly with the nouveau driver, then that would suggest that the installation of the nvidia drivers is implicated in the problem.