Most smiths in my neck of the woods charge about $40. I turn the OD by lathe. I leave the OD very tight, and then fit the lug. Once I get it fairly tight by wrench, I find out how tight the person wants it. If they only want it finger tight, I take a lot of time lapping it in with fine lapping compound.
At this point I use a hand reamer for the ID, and get it super sight, then lap it in. I the check for barrel springing and make my relief cuts. All in all, if the bushing is going to be wrench tight, it takes me about an hour. If it's going to be finger tight, then it takes me about 3 hours. Either way, I would not charge $100 if I were a professional smith, but maybe your guy is really good and will be doing a lot of work. It sounds very overpriced to me though. Heck, I'd send it to 1911builder, as he'll do it right and for a great price.
By the way Charles, now that I know where you used to work, I've mentioned you to a couple people here in Phoenix. You really have a great reputation.