Clearly, if your thistle tube were not below the surface of the liquid in the beaker, any gas generated by your reaction would simply exit the beaker through the open tube to the atmosphere. With the Thistle tube below the surface of the acid, once the
pressure in the beaker is greater then atmospheric, the gas will displace water in the collection beaker. There will be some gas generated inside the thistle tube but only a very small amount.
I assume that initially the reaction beaker is completely filled with acid. If there is any air above the acid any gas collected will be mixed with what was initially in the reaction beaker.
There will be some of the reacting material forced up the thistle tube by the same pressure which forces the evolving gasses into the collection beaker. But since the density of the reacting materials is much greater then that of the gas being evolved, the column in the thistle tube should not reach the level of the collection bottle.