You obviously set high standards for yourself. This is a double edged sword, it can give you confidence, it can also tear you up when you encounter those (friends and foes alike) who want to tear you down, and you start to doubt. Quit listening to the nay-sayers.
Whenever I think I'm about to get upset over a passing comment or a look from someone (another nurse!) that I can't quit figure out, I just always think to myself, do I really believe they are giving as much thought to this as I am? You are agonizing over this teacher and he probably doesn't even give you a second thought once you are out of his site. Think about that. You are just another student to him, he is not going home at night and thinking about this, trust me.
I understand you don't want to play games, but I'll tell you that the world of medicine revolves many times around these games. You either deal with it, or you take your toys and go home. Do you really think that physicians are going to care about hurting your feelings, they don't give most nurses a second thought.
There are other students who have to play besides nursing students. My son is in college, he has friends in the architectural program, pre-med, law school, etc. They all have to play. I know nursing students think they are the only ones who have such crap to put up with, I used to think that way too, but they aren't. It's actually part of the higher educational system itself. It's the way the American system is set up, student against student, teacher against student, teacher against teacher. If you think instructors don't have to play games within the administration they are in you would be wrong.
Only you can define if you have what it takes to get through school. You can determine whether they win this game or you win. Take the weekend to do some deep breathing and mind clearing. We've all been there, trust me. Can you do it? You thought when you went into this you could. Know what? I think you were right, you can do it.
And one other thing, please don't take offense. You're just a baby in this game of "nursing standards" as you put it. While you have some theory under your belt and some clinicals, don't assume you really know much about nursing yet and can pass judgement about licensed nurses' practice. Nursing school really doesn't prepare you for the real world. The "nursing standards" you hold now as a student have little to do with doing real nursing. You are still in the idealogical stage where you think you know more than you really know. This 25 year old kid that is your teacher knows so much more than you do. Rather than look for things you judge he does wrong, look at the things he does right and knows. You may someday look back and see you were very wrong about him. I know I had teachers I thought didn't know much about "real nursing" because I knew the book backwards and forwards. Well, I now know that they were pretty darned sharp and a lot of what was in my nursing texts were systems of theory that don't exist in the real world of nursing. That's just a tip.
I think you will be fine if you just quit doubting yourself and start running with the ball. It will all be over before you know it.