It doesn't sound quite so bad now but I would insist on the conduit running inside the garage like the inspector said. It would be well if you stayed on the job and questioned items as they arise, although that will really get under the contractor's skin. He brought it on himself though, so I don't feel sorry for him. You should ask the ispector which code book he was using and get a copy so you can keep up with occourances.
Most important, don't pay him any more until you are perfectly satisfied with the work. Keep notes on things discussed so he can't try to slip one by you and invite the inspector back at the end of the job to help you make a punch list of every item that bothers you. Remember, once the contractor works off the punch list he will expect to be paid in full and you will never see him again; so be very thorough with the punch list.