Flagging it as VLQ just means that it goes into the VLQ queue. In that review item one person recommended deletion and one person (incorrectly) said that it "looks good". Because of that, your flag was marked as "disputed". Clearly this post should be deleted.
No moderator acted on it. Had a mod acted on it before the queue handled the flag then the flag would have been either marked as "helpful" or "declined", not "disputed".
In general "disputed" means some non-moderator action determined that the flag should not be acted on. In some cases this means other users were given the option to review the flag and determined that it was invalid (either from a review queue or the 10k tool page) or possibly due to automated actions (i.e. a user editing the post would mark a VLQ flag as disputed). Other automated actions can mark a flag as helpful, for example the post being deleted (by a mod or otherwise) will result in certain types of flags (including VLQ) being marked as helpful.
If you feel that this action was taken in error (such as is the case here) then you can use a custom mod flag, rather than any other flag. Custom flags are always shown to a moderator, and can never be seen or invalidated (or validated) by any non-moderator users or through any automated processes. This shouldn't be your first choice though, because avoiding the consumption of mod time when their help isn't needed is great; this should be an option for when other flags "fail".
