Hi, I'm a piano teacher.
I can see it from both your point of view, and the teacher's. From the teacher's point of view it has seemed like it is going nowhere - especially when she found out he was practising on an iPad.
You can, despite what others have said on here, start on a keyboard although that will not be as good as a digital piano - but you could start off on one, as long as it has touch sensitive keys and full size keys ( I don't mean that it has to have as many keys as a piano, just that each key is the same size as a piano key). After a year or so if still playing, he would need to move to a digital piano or acoustic piano (digital are much cheaper.) But you absolutely could get away with a decentish keyboard for now, just to see if he's interested. (Digital pianos look like keyboards but have fully weighted keys and are more piano-like than a keyboard.)
Personally I would give a student longer than 6 weeks. I've had plenty of students who chatted too much or mucked about at the start or even had no strength in their fingers and no eye to hand co-ordination, who later improved with practice and encouragement. On the other hand, some kids won't practice or won't progress very much, and it's best to face up to that whenever it's the case. Perhaps the teacher didn't know you were getting a keyboard. (You should really have had the keyboard before going to lessons, or at the very least for the 2nd lesson.) You could ask the teacher to give him another while at it once he has the real keyboard to see if he can develop an interest in it, maybe offer to go for a probationary period of another month or two? If you get him to practice every day (on the keyboard, not iPad), for say about 15 mins, his fingers will strengthen up. Also you can have a word with him about the chatting throughout the lesson etc, tell him to listen carefully and do what the teacher says.
Re the covid thing, yes it's standard practice now to not carry lessons over that are missed for any reason (although that should have been in the terms and conditions). Some people are a bit more flexible re covid -I am, for instance - but at the same time, it's the teacher's livelihood so if a student misses their slot there's nothing else they can do with that slot. Once you know what the policy is then it does encourage good attendance when possible, which helps a lot. Some teachers offer zoom lessons if you're sick, stuck at home etc.
I would say it's too soon for you to write off your son's wishes to learn piano - I'd be approaching the teacher, apologising for not having the keyboard yet but explaining that money is tight or whatever, and asking would it be possible to try for another while to see. It may turn out, as it sometimes does, that the teacher is not a good fit for your son - she just may not like teaching him (the chatting thing can be annoying) and perhaps she has a very strict policy, a 6 week probation period - some teachers do, and I can see the sense of it. To me though, you yourself should know is your child willing to practice and does he want to, so I would get the keyboard (because you'll be able to sell it on easily if you end up not using it in future), and try more lessons either with this teacher or failing that, another one. (Sometimes you do need to try another teacher to get the right fit.).
If, after a few months of consistently getting him to practice , he really is not taking to it and wants to quit, then let him. But he really needs to practice on a piano/keyboard for a while to see. Improvement can be rapid. Depends on the books used too. I'd recommend, if possible, finding a teacher that uses the Piano Adventures teaching books, rather than John Thompson or similar. A much better approach.