I don't really understand what the controller was yelling about. The phrase "Resume own navigation" only refers to lateral course guidance and has nothing to do with altitude. The phraseology for Class C service regarding altitude is very clear:
7-8-5. ALTITUDE ASSIGNMENTS
a. When necessary to assign altitudes to VFR aircraft, assign altitudes that meet the MVA, MSA, or minimum IFR altitude criteria.
b. Aircraft assigned altitudes which are contrary to 14 CFR Section 91.159 shall be advised to resume altitudes appropriate for the direction of flight when the altitude is no longer needed for separation, when leaving the outer area, or when terminating Class C service.
RESUME APPROPRIATE VFR ALTITUDES.
You got it right CH2Tdriver. You just keep that old P/CG close by and you will not go wrong.