The flange is supposed to be attached to the drain line! and solidly to the floor. What kept the toilet in place beforehand? Maybe it was caulked to the floor?
Does the pipe in the floor move at all? Is it plastic or cast iron?
Ideally, the flange should sit on top of the finished flooring. Depending on the pipe and the flange type, and if it moves vertically at all, you may be able to put the flange on the pipe after you get the tile down. One of the pros may have some other thoughts.
Is the flange one that fits on the outside of the pipe, or on the inside?