Simple answer is Yes. Mode C does sometimes cause predicted STCA alerts while Vertical Separation is still maintained. Maybe our Radar is a bit over-cautious - maybe not - that's not really for me to answer. The alerts would not be an everyday or a regular occurence and are not related to aerobatic activity. Our Aerobats don't get close enough to IFR traffic to cause problems. Our IFR / IFR do alert sometimes due to high ROC/ROD while still separated. I've yet to come across a false TCAS RA, and it is possibile that the extra precautions may have contributed to us not having had one.
Without getting too tit for tat .....
1. When the pilot adjusts the altimiter settings and it's checked and indicates airport elevation, that's the "car boot sale" altimiter calibrated. Of course this doesn't check the encoder - thats what we do with verification.
2. If, as you suggest, a pressure altimiter is correct at aerodrome elevation and incorrect at higher altitudes, what will happen? If there is no backup system he'll climb till reaching his desired indicated altitude. ATC will check his alt if it's different from the cleared level and if an error is found, it's the mode C that'll be turned off.
3. Yes, you're correct, Mode C encoders use QNE/1013.2 at all times and the Radar data processors will decode the data & display Alts or FLs as required. Next time in radar, watch a mode C as it passes the Trans Layer.
4. The mode C data is checked when it is verified by the controller, which again, does not mean that an unverified mode C is wrong - it just means that it hasn't been checked yet. If it has been checked and is found to be wrong, it can be turned off and no longer cause confusion. 9 out of 10 unverified mode Cs in uncontrolled airspace are within limits, but just not checked yet. Use it unverified only as an aid to VFR traffic info but not as a method of IFR separation. eg, Unidentified Tfc, 11 O'clock, 2miles, indicates 1200' unverified.
5. Now I think we all agree that mode C should be used if it's available. The majority of our aerobatic activity uses mode C, but some does not. Generally, it's the Gnd-5000' over the airfield that does not, and the Remote Area FL100- FL300 that does. When it's not used, it's because of genuine reasons and extra precautions will have been taken.
And entertaining as it is
, I don't see any need to argue these points any further. I think ATC everywhere uses the same general rules with regard to mode C verification and use.