Aviate, navigate, communicate. Never let anyone lead you in to a situation where you can no longer aviate.
An experienced pilot would either gratefully do the orbit or decline with an safer proposal. Unfortunately the ATCO rarely knows whether the pilot is experienced or likely to feel compelled to do something dangerous. I see nothing unsafe in the controlling, but immediate clearance to land seems odd.
Rocket
ATCO's have been taught not to orbit circuit traffic on final
It's a few years since I've been taught, but I do recall being trained to do exactly this both flying and controlling and have no recollection of anything contrary to this other than for noise abatement. Can you enlighten me?