You are correct. This is kind of set phrase. On the other hand, I think (1) is just wrong. If you put "それから" into the brackets, I think of two situations. One is that the speaker tells students to do something before the class is finished, for example, "校歌を歌いましょう。それから、終わりにしましょう". The other is that the speaker talks about something else for a while, and he/she adds that the class has to be finished. However, that sounds rather casual and I don't think teachers usually speak that way in front of students, so this situation might be less realistic.