When it comes to meta-knowledge, I treat it like this-
An author of a story doesn't meta-knowledge his characters when they interact with eachother. A good author will stay consistent to his character's personas, almost as if "they're writing themselves". If a personality is already set to act in a certain way, then that reaction shouldn't change just to favor one over another from bias.
By the same fashion, the "story" of a party in a game shouldn't have meta-knowledge applied to it. Of course, this is all up to what the GM allows.
Consistency and conveyance are the two most important aspects to adhere to in DnD, after all. To not do so would be disingenuous to your character and the game.
If a GM wants to avoid the kind of characters that, when acting in accordance to their personality screw the rest of the group out of story progression or loot, then it should be established before 1st session.
I'm assuming this was not the case for your particular campaign.
So as far as I'm concerned, if I'm going to run a game where an unscrupulous thief would be unwelcome, then I'll say so from the beginning. If not, then it's fair game and I'll make sure my players are mature enough to keep in-character and out-of-character separate, as it should be.
As it stands, I agree with your GM's call to needing the sleight of hand versus the party's perception rolls; with the appropriate modifiers to all rolls involved.