You are correct, the police could confiscate the vehicle, but in certain circumstances they could or would inform the DVLA who would contact one of their local contractor's, who would then clamp or 'take to the pound', until the dues are paid.
There as been a number of successful appeals, and there have also been cases of the judge throwing the cases out of court, due to the incompetence of the DVLA legal teams.
A tax disc is a complex item nowadays, and nothing like the days of the 'Guinness label'. I have seen tax discs altered, blocked, defaced,off another vehicle, including one that was made from three discs, and very expertly done. That one took a little fathoming, until we realised that there was 12 months in a year and not 14. There have been many other incidents, all worthy of a smile or chuckle.
Forget about it, unless there was other offences committed that you have not mentioned. If you got caught out with a camera, then the DVLA records should show that you have a disc for the vehicle.