He also told me to put the transponder to ALT after we had taken off, due to the possibilty of me lining up and a aircraft on finals having to go round due to a TCAS warning??
In addition to what 2D's says, your instructor shows a complete lack of understanding from what he says (if that's what he says).
Reasoning being is this - if you've been told to line up then the aircraft on approach will
not have been cleared to land.
So - on that basis - why would he go around?