This instructor was wrong, plain and simple .............
.......... Why was he wrong? Because there is no SOP for such an event, ergo you can't be "wrong" in such a situation.
It is a judgement call and what he did during the debrief was give his opinion and that is all it was and he should have made that clear and backed it up with sound logic, not simply, its designed to fly on one engine. And that is the problem with some (perhaps too many?) They often state opinion as fact. Whereas, a good instructor would, if he felt there was any value in his opinion, open it up for a "facilitative" debrief.
Like many of these situations it's a Captain call and he/ she is only wrong if that decision results in a worse scenario than other options.