Ken is the ONLY Colt dealer with an exlcusive agreement with Colt. He also thinks they are the best, and he doesn't want to warranty someone elses product. That is simple enough.
Let's assume that Ken's shop time is 65 dollars an hour. He restakes the key. He does a few other thing, replaces most of the springs. Puts in a buffer which costs about 20 dollars. When you consider the 100 dollar cost of the package, when done on a Colt which he sold you, it's not that bad of a deal.
If you ship your rifle in, he has to file your FFL, open the package, do the mods, repack and ship back out. That's a lot more trouble, I'd say about, oh, 50 dollars worth.