If you review the EditLive documentation you will see that the normal way to hide the code tab in EditLive is by modifying the tabPlacement property of the wysiwygEditor element in the EditLive configuration file. This technique is not supported in the current IBM WCM integration.
Instead of setting tabPlacement to "off" in the EditLive configuration file, you need to use a setting in the Authoring Template to control this capability.
When creating/editing an Authoring Template there is a Default Content tab.
Each Rich Text field on the Authoring template will have a small icon (looks like a piece of paper) that allows you to edit the field's properties. In the above example its to the right of the word Body. This exposes the properties for the field.
You will note the Disable Source Mode checkbox - if you select this option the Code tab will not be visible when using EditLive.
Note: It is not possible to hide all of the tabs in EditLive. The most "minimal" setup will have a Preview and Code tab.