Sounds like the typical type of talk one might get when faced with an Instructor of another style who for one feels the need to sell his style's superiority (or at least his own) and secondly thinks that the person in front of him does not know enough about the styles being compared to actually dispel some of the BS he may be putting out.
As far as what one does when on the ground with the 250lb person punching etc .etc. if one sticks to Aikido principles this does not happen and even if it did there are some options within Aikido before the other person gets full advantage to put you out. If it still happened that Aikido did not work, then this is when one goes into grappling and striking from the ground, whatever format it may take, whether Judo, Jujutsu or a mix of unidentifiable things.
But then again, this is why you are visiting his dojo, to learn how to handle the scenario he gave effectively, so it's obvious to me that he is less concerned about you learning something from him and more concerned about blowing his own horn and beating his chest.
He also made sure to put forward a one on one scenario that he knew his blue belt could survive and win to attempt to show superiority. I wonder why he didn't give the scenario of his student or himself against a group of 5 or 6 FMA knife or stick weilding attackers (not saying that Aikido will necessarily deal with this scenario better, but the strength of BJJ is in dealing with one attacker at a time.)
Happily my experience at the BJJ dojos I've visited was not like that. Even when they have been proud of what they do, general respect was there and they knew that no one art does everything well and is effective in all situations. For me though, the Sensei you met would have been left talking and bragging while I walked out the door.
Just my 2 cents.