Some background info for the discussion - as it *seems* we're talking about moorabbin:
Firstly, it's been a few years since I flew there, so apologies if any of this is out of date, or time has corroded my memory! Being in suburbia, there are lots of houses, which can make spotting a/c below you a bit tricky. It's towered (class D), and used to be GAAP (which is an 'Australianism'), I believe that was changed due to review which happened after the aforementioned incident. Two sets of parallel runways, which were 17/35 (L/R) and 13/31 L/R last time I checked. The airfield is overlaid by the Melbourne CTR, the airfield zone is/was 3nm/2500ft. Typically circuits are conducted on the east side, and arrivals/departures on the west, with separate frequencies for each side. The overhead is rarely used, except when you want to arrive from the wrong side; normally I would arrange to route so as to enter the zone via a VRP on the side I wanted - that was fairly common. It's extremely busy, the tower are / were very good. Normal procedure (was) to report inbound at 1500/6miles at one of the VRPs', then as directed by the tower, usually descending to 1000 and arriving directly into the downwind, base, or long final - again dissimilar to the UK's penchant for overheads. Departures would climb above this level ASAP, and depart from the appropriate leg of the circuit for where they're going.
Given it's extremely busy and there's a lot of training, 'Airliner' circuits are not uncommon. You need to keep your wits about you, and know where the others are. I always found the tower really good at helping you slot in and queue jump where appropriate - e.g. offering / accommodating tight base/finals where the a/c ahead is departing the zone and such like, but that's not early solo stuff.
For the OP, I'd say that when you're told to 'follow', don't *ever* loose sight of the other a/c, and always aim behind their tail! If you can't find him, or do loose him, don't report where you are and hope - ask. I have no idea how many times I've asked MB tower for a steer on where to look for that traffic. Don't worry about where you're *supposed* to turn, that is entirely negotiable. I imagine that's now been imprinted pretty well (and I don't mean to be unkind).
My other comment is that ATC 'instructions' are to be followed in good time, and in a manner consistent with safe flying (or words to that effect), and not immediately, or inflexibly - I suspect the tower expected you to turn left behind the Cessna - i.e. you make a left in turn, not both go left immediately on instruction. WRT BackPacker's post, I'd also remind (everyone) that you are allowed to say no ('unable'), and even take initiative *then* tell ATC if you need to. Note the "if you need to". More appropriately to the OP, don't forget to ask the tower for help. Usually that stops things reaching the 'oh ****' stage.
With respect to the midair mentioned, rather different circumstances. There's a proper report here:
http://www.atsb.gov.au/media/2486211/ao2008059.pdf
Apologies for the essay - I only intended to give some airfield background!