https://www.scs.stanford.edu/~dm/blog/hide-webcam.html
UPDATED:
Simple script to run through all the steps:
if [ "$EUID" -ne 0 ]
then echo "Please run as root"
exit
fi
# Make v4l2loopback run by default
echo options v4l2loopback nr_devices=2 exclusive_caps=1,1,1,1,1,1,1,1 video_nr=0,1 card_label=v4l2lo0,v4l2lo1 > /etc/modprobe.d/v4l2loopback.conf
echo v4l2loopback > /etc/modules-load.d/v4l2loopback.conf
modprobe v4l2loopback
read -p "Enter username: " username
# updates user to be in the video group
usermod -aG video $username
ls /home/$username/.config/obs-studio/basic/scenes/
echo "Select the correct file above and update the camera source with the following camera device paths:"
ls -alh /dev/obs-only/