This parent is driving me crazy! Am I wrong here??

[bright sparks]

Are all kids required to stay on their bed for the full three hrs regardless if they sleep or not?

Not necessarily. If they are quiet then its not a question of requirement as they just lie quietly anyway. Sleep is not required, so if a child is restless and uncomfortable and has been lying quietly for a couple of hours and hasn't slept, then depending on the child, and in general the whole dynamic of my group, I might allow them to get up and play with playdoh quietly, do some colouring or watch a tv show. If all my kids were awake and I could hear them talking, moving around etc, and it had been a good couple of hours then for the most part we would just get on with our day. While I value my break, sometimes we can't get as much done as we would like because of long nappers, so sometimes having everyone awake at 2/2:30 means we can have more fun times in the afternoon before pickup.