Do you guys think the action of the people at this concentration camp helped with the notoriously bad accuracy of the V-2 rockets?

I do not think it is fair to say the V2/A4 rockets had "notoriously bad accuracy". For their time, they were pretty darn impressive - certainly not like smart bombs of today, but for 1940s tech they were nothing to sneeze at. Their LEV-3 two free gyroscopic 3-axis inertial guidance system (one gyro for roll and yaw control, and one for pitch control as well as for lateral stabilization), when coupled with the PIGA gyro-type accelerometer to control engine cutoff time and an analog computer for azimuth control, was definitely state of the art for its era, and was considered pretty groundbreaking in terms of onboard inertial guidance capability. Some of the later versions adopted a ground controlled "radio beam" guidance system and engine cutoff addition, and were also quite impressive for their time (though that left the V2/A4 open to being targeted by radio jamming during certain stages of flight). The Americans were certainly impressed with the rocket's guidance system after the war when they brought a bunch of V2/A4 rockets, parts, and rocket scientists over stateside to dissect, test and learn from.

The inaccuracy of the overall V2/A4 system was more due to the fact that this was early stage inertial guidance technology, and thus was prone to poor Circular Error Probable numbers due to the system's youthfulness and lack of effective testing. Accuracy of the system was also hampered by British Intelligence efforts that did a lot to try to conceal the exact locations of V2/A4 rocket impact points in England and elsewhere during the war by feeding the Nazi's false impact location data via the press. This lack fo complete hard impact location data forced the Nazi's to not be able to correctly refine and correct trajectory programming to better home in on targeted population centers with increasing accuracy. Still though, for its time, all things considered the V2/A4's did have quite good accuracy capability if programmed properly and the launch locations surveyed correctly.

As for the POW/forced labor sabotage efforts at sites like Mittelbau-Dora (where the bulk of the V2/A4 rocket system was manufactured and assembled), that definitely did take place, though was not widespread. Sabotage efforts from the POW and forced labor work crews was of course met with very harshly if caught, resulting in immediate execution (in many cases not just of the saboteur, but also some of or the entire group of prisoners on shift with them as collaborators, carried out in full view of all the prisoners at the facility, typically hanging them from cranes in the tunnel by the neck and leaving the corpses dangling there for several work shifts as a reminder). Prisoners typically had to label every part of the rocket system they worked on with their own personal ID numbers, so if post-assembly quality control inspection revealed shoddy work or deliberate sabotage the SS security guards at the complex knew exactly who to target for retribution and execution.

While I am unsure of this specific "diamond powder" sabotage technique you are speaking of, it is known from later allied interviews with some surviving prisoners at the Mittelbau-Dora complex that they did engage in some more passive sabotage efforts much like the gentleman you spoke with described, such as for example deliberately applying poor "cold solder" connections in some of the electrical sub-assemblies and guidance systems that would be more prone to shorting out or producing intermittent signal transmissions when stressed, thus making the systems more prone to failure after launch while being subjected to the rigors and vibrations of flight. Some prisoners also described using only partial arc welds in some high stress areas of the rocket body that could be hidden from inspection due to the assembly process, with the hopes the partial welds would past ground certification but be weak enough to fail after liftoff under launch loads and the various stressful flight regimes. However, due to the extremely harsh punishments if caught in the act of sabotage coupled with the close eye the SS guards had on the prisoners during assembly, and the quality control inspections afterwards before flight certification, it is believed that deliberate sabotage efforts on the V2/A4 rockets by the prisoners was not very widespread at the Mittelbau-Dora facility, but rather was quite a rare occurrence and thus was not highly effective at disrupting the guidance systems on the vast majority of the V2/A4 rockets coming out of the facility. Again, the lack of accuracy of the system, though excellent for the era, was more due to the fact that these early guidance systems were cutting edge tech and just not tested or refined enough for high accuracy by the time of war's end.

It certainly plays a role in explaining things, but it wasn't necessarily the sole explanation. Two things one must remember in regards to the accuracy of the Vengeance Weapons program. The first being that you have to be very clear up front in what you are measuring a V2's accuracy against. When comparing it to say, a present day cruise missile, it is certainly not at all very accurate. But compared to the average accuracy of a bombing sortie carried out by a contemporary heavy bomber raid, it's accuracy., Even if it's off target by half a mile, is still something notable for it's time. One also has to remember that even as advanced as Vengeance weapons were for their time, they were still the end results of the earliest military experiments in weaponized rocketry. Which were being deployed by a power desperate for anything that could help tip the war in their favor even if it wasn't necessarily the most pin-point accurate or cost effective weapons platform.

In regards to your question about slave labor, the use of slave labor by the Third Reich in the manufacture and production of arms and other military goods during WWII certainly had it's drawbacks for the Third Reich. One of which was a higher than average proportion of bombs and arms that were faulty or failed to work adequately. Richard Evans (a historian notable for his work on the Third Reich) even has a personal anecdote on the unreliability of German arms manufactured by slave labor.

Sabotage and the intentionally faulty or sloppy assembly of bombs and other military goods by slave laborers were not uncommon as the war went on. Upon Albert Speer's appointment as armament minister in early 1942 as well as Germany's official recognition that it was now in a state of total war in early 1943, vast resources of manpower were tapped from occupied countries as well as from concentration camps in order to free up German manpower that was desperately needed to sustain the German armed forces. This obviously had it's pros and cons for the Third Reich.

It can be also demonstrated that whereas arms and munitions that were produced either prior to the outbreak of the war or within the first 2-3 years of the war typically had a failure rate comparable to that of other belligerent nations. Though as the reliance upon slave labor increased, so did the failure rate of military goods and munitions.

Another problem, is that while Speer prided himself on his ability to increase material output threefold during his time as armaments minister, he didn't necessarily make the added effort to ensure those increased outputs maintained the quality they had prior to the massive dependence upon slave labor. As a result, despite constant reports of materials and munitions reaching front line service and not being adequate for combat use, the rate of faulty equipment continued mostly uninhabited until the end of the war. Speer would from time to time make inquiries or adjustments to try and improve the quality of materials he was supplying the Third Reich with, but the results were often negligible.

Sources:

Wages of Destruction by Adam Tooze

The Third Reich at War by Richard Evans

The Bombing War by Richard Overy