"Aroused havoc" really doesn �t work, because havoc is more the result of arousal than something to be aroused. In the US, at least, "wreaked havoc" is the most common expression.
If we aren �t talking about a specific time in the past, "Andrew was dancing happily late at night" is OK. If you try to put the sentence into a context, though, it might have to be changed. The sentence is grammatically correct.
No, "late at night" is not a specific time in the past. It is just a vague period of time, past, present or future.
The main difference with the continuous tenses is that they specify an action over a time period, rather than at a specific time, so either "was dancing" or "danced" can be correct. It all depends on the context and the intention.
Bruce