The root problem here is a misunderstanding of the appropriate hook. auto_update_plugin does not control if automatic updates are enabled, but rather it’s a filter to gain finer control over wether a specific plugin should auto update a specific update.
For example, if you want to enable or disable wether plugin auto-updating is possible, use the plugins_auto_update_enabled filter.
If you want to override a plugin and force it to auto-update or not update, use auto_update_plugin and inspect the second parameter, the format of which matches what the .org API at https://api.wordpress.org/plugins/update-check/1.1/ would return