I would like to bet that if you ask any ME/IR pilot what the most difficult flying they've done is and most would respond single pilot, actual IMC, non precision approach into an unfamiliar field.
I'm not sure what the current 'legality' of using automatics during test is - but in reality whilst flying routes I'd recommend every chance you get let the system take the strain and just monitor what' s happening. Gives you more time to prepare for the approach.
Could you have miss interpreted the conversation in that the student would auto the route flying and manually fly the approach? If the student was planning to autopilot an approach in one of my lessons then I'm fairly sure that the 'unreliable' autopilot just might rear it's head again at the most inoppertune moment! Maybe his instructor had similar 'fiendish' tricks in store.