Recently had a not disimilar incident (class C
and ATC) but without the "verbal hassle", and did much the same as you. I was sufficiently concerned about it though, and made a CHIRP report.
Approaching from the southwest, I was cleared to join downwind left hand for 25, with no mention of any circuit traffic. On approaching the start of the downwind leg I saw another aircraft climbing up on the crosswind leg on my left, but no instructions from ATC to either of us. I was on the right, right? But, like someone else said, it was abvious he hadn't seen me (and neither had ATC it seems) and had no intention of turning behind. So I bent it right a bit and stayed "outside" of him - then got a mild b****cking from ATC for forgetting the downwind call.
The CHIRP people's response was the "in the circuit its see and avoid", as some one else said, earlier. Seems to me you did right, right?
