As far as service drops are concerned, the local utility rules trump the NEC. They are the "AHJ."
Just as important, there is already substantial law on the matter. The utility has right of "eminent domain;" if they order the stuff grouped together, the parties will not be allowed to "forbid" anything!
Likewise, neither neighbor would have the 'right' to deny the other access to the disconnect.
Now, it's the job of the town, and the PoCo, to solve this mess. You're just the contractor. If there's a problem, it will be up to them to take the necessary steps..
