500 ft QFE
Cyclically
I consider this a very good post as I have had a similar clearance issued to me.
The various replies are interesting but some do not really answer your question.
I believe that the clearance is issued because of the use of QFE at Military airfields. Once the controller has it in his head that you are low level, then it is easier for him to keep you in that band for other traffic purposes.
You rightly say that rising ground away from the airfield will force you to break the 500ft rule. This is your responsibility alone and I am almost certain a military controller does not have the authority to absolve a civilian aircraft from the ANO rule unless you have a CAA exemption.
When entering a MATZ I make it clear my position and the hieght band I wish to operate. This may not give ATC an easy time but as a MATZ is not controlled airspace then he cannot get too prescriptive unless you approach the ATZ.
Having said that, I have found, in the main, military controllers to be of the very highest standard in the operation of the airfield and MATZ.
If they no that you are operating in a particular height band then they do not have to bother you or other aircraft with unnecessary traffic information and I think that may be one of the main reasons.
As far as whether QFE/QHN/QNE is the best setting to use then our company uses QNH only for IFR operations which I do not have a problem with and does offer certain advantages as pointed out in an earlier post.
However having recently operated IFR into a military airfield on QFE then that did not seem to be a great problem either providing on the go around you remember, once he has finished with you, to set QNH for terrain clearance and making sure you do not bust into other controlled airspace above.
Regards
P