S took DE course in summer at community college after soph year and yes he was required to submit a transcript to both university and med school. Grade does factor into med school GPA but adcoms know a course was taken during high school and it will not carry much, if any, weight, especially if you’re rocking your college courses. So if you can take Psych DE and believe you can do well, I’d go for it v AP.
Also as psych concepts are now included in new MCAT, if not already a req, I’d expect psych will become a standard “premed” reqs at all med schools in future. Whether you take AP or DE, you’re going to have to revisit all “premed” materials at some point and I’d assume that more structured MCAT prep (e.g., Kaplan, Princeton Review) have/are incorporating psych prep into courses. IMO having a course like psych behind you as MCAT approaches would allow you to lighten your course load/rigor somewhat to prep for MCAT where your performance will matter a great deal more to adcoms than say a C in a DE course. Good luck.