re: "Person wanted all future conversations outside upwork and stated he had an agreement with upwork that it was ok"
Upwork does not make "agreements" with clients that say it is okay to have conversations outside of the Upwork Messages tool.
EVERY client may communicate ANY way that they want to once they have officially hired a freelancer. After being hired, nobody is required to use the Upwork Messages tool.
re: "I received my first milestone payment, but am now being asked to provide PayPal information so the rest of the funds can be paid. For the record I didn’t do this."
Of course you didn't do that. You know that ANY funds transfer outside of the Upwork system is a serious violation of Upwork ToS. You know that freelancers can be suspended or have their accounts permanently terminated for doing something like that.
re: "Person is using outside measures to track hours worked instead of upwork as well."
Well, there is no rule against using outside measures to track hours. But those outside measures don't count as far as an Upwork contract is concerned.
re: "I believe I’m being scammed... Now I’m beginning to think it’s somehow a scam. People are continuing to work for this person and aren’t getting paid."
I understand that this client has talked about violating Upwork ToS with you... an offer that you declined. And you seem fairly certain that this client is violating Upwork ToS with others.
It is certainly reasonable to report this client, so your post here is appreciated and will do some good.
But out of curiosity, what exactly do you mean when you say YOU have been scammed? How have you personally been scammed? (It sounds to me like you were wise enough to not fall for any of this.)