Does the AP disengage if the plane is upset and how would the flight controls react if not being held?
For non FVW airplanes: 

Yes it will disengage if certain pitch and roll attitudes are exceeded.  When it disengages, the controls are "let go" if the A/P was applying an input at the time, and the control column will move to whatever its natural trimmed state is at that time if the elevator is manually operated with trim tabs.  

If the airplane has irreversible hydraulic controls and an artificial feel system and a trimmable stabilizer, the column will just spring back to neutral and the airplane will seek its existing trimmed speed.  If the trim speed is the same as the current speed, pretty much nothing happens, if the trim speed is much different that trim speed, the nose will pitch up or down to try to accelerate or decelerate to the trim speed set by the current state of the pitch trim system.

It's as if your copilot was flying, minding his own business, and you shot him dead.  The column will just go to wherever it wants to go when no-one is holding it.  The airplane has natural static "stick-free" stability so it will seek its natural trimmed state and if the A/P input was different from that, it'll just start going where it trim state wants it.  As if you pulled on the column and then let go.

On an airplane with control cables, the autopilot is a little computer running a bidirectional electric winch (the A/P servo) back in the tail who's winch cables are tied into the elevator cable run.  It drives the cable circuit from back there instead of from the column.  The autopilot also usually works the pitch trim that same way a human pilot would, to relieve the need for the servo to hold control pressures beyond a small threshold same way a human would.

So if the airplane was more or less in trim when the A/P kicks off, not much happens.  If the airplane was in some crazy attitude because of some outside event, the A/P kicking off is like you were flying and got flipped over and you took your hands off the controls to cover your face in fright (that's what I would do lol). The controls will just return to where they are trimmed to go to in that state.  On most airliners with powered controls and a moveable stab, the column always springs back to the same neutral position regardless of trim state.

If the a/c is FBW, the A/P is integrated into the computers that actually run things and it gets a lot more complex, although the end results are not that much different.