In the context you have quoted, the word "as" is a conjunction like "when" or "while". The words "while" and "when" have a subtle difference in the sense that "while" has the idea of "during", a more elongated time. In your quotation #1, "while" could not be used in place of "as", but "when" could be. In the second example, "as" could be substituted for "while".

"The script reads 'as' but I think 'as' could be interchangeable with 'when', and 'while.'" ...sorry, but this is the problem right here. You're making assumptions about how the language works before fully understanding the rules. For a simple explanation, think of it this way: as = at the same moment when = the actions go in sequence. The second action follows the first action; not at the same moment. If you use "when" in the first sentence, it means Michael stops in reaction to (ie. after) seeing Susan. while = as Randy has pointed out, we have a longer timeframe here. Pretty obvious. Yes, there are a couple of possible overlaps, but assuming the words are all interchangeable is a huge mistake.