iCamSource must be running on your computer in order to view your webcam on the iPhone.
iCamSource doesn't overwrite the computer's sleep settings, but you should make sure that the computer is set to never go to sleep. If the computer goes to sleep, iCamSource won't be running, so you won't be able to view the webcam in iCam.
The iCam app does not change the iPhone auto-lock setting by default, but there is a setting in the iCam options page that allows you to disable auto-lock while the program is running.
