Heed the words of the very experienced mates like britbusdriver and Airbedane, WSO1.
But what concerns me is that you stated "My instructor was initially going to pass me, acknowledging himself that I was safe at all times, then decided to fail me." That just doesn't ring true. Any instructor who said such a thing is leaving himself open to redress; if you are sure of your facts then present them calmly to your boss as such and ask for a refly if at all possible due to the margins of doubt in your instructor's alleged assessment.
Is it really '2 fails and you're out' nowadays? After investing as much as they have in you, the RAF should be bending over backwards to graduate you - unless there really are fundamental doubts about your future employability.
Good luck - keep us posted.