Positioned around piano in dispute (4)
I believe the answer is:
spat
'dispute' is the definition.
(I know that spat is a type of argufy)
'positioned around piano' is the wordplay.
'positioned' becomes 'sat' (sitting is a kind of positioning).
'around' is an insertion indicator.
'piano' becomes 'p' (musical abbreviation).
'sat' enclosing 'p' is 'SPAT'.
'in' is the link.
(Other definitions for spat that I've seen before include "Petty row" , "Short gaiter or slight quarrel (4)" , "Showed contempt" , "Small row between Pats" , "Small quarrel between Pats" .)