Is it possible to code an app in the Design unit (lesson 10) and have the Microbit connect w/ battery instead of USB?
The battery pack will power the Microbit but you need the physical connection to the computer to interact with App Lab. If I am understanding your question, you need the USB connection when using App Lab.
An alternative for the Microbit is to use Makecode for microbit to code only the Microbit without the app interface. In Makecode, after you have coded your Microbit, you download your program and load it on the Microbit. You can then run the program on your Microbit using the battery pack.