You did say "estimate" as in singular. Have you gotten more than one just to insure you weren't thrown a big number just to see if you would bite? As an example, someone on here posted this week that they blew their powerhead. The shop where he took it quoted $9500 for a rebuild on a Mercury Pro XS 250, which got a "say what?" response out of multiple members. I have't gotten such an estimate for mine, but I understood from a shop owner buddy that such a rebuild would be under $4000 if he was doing a typical rebuild for such a motor.
I have no idea what the right numbers are for a lower unit, but I'd say you should get multiple estimates, and try to pick shops you have some good referrals for. THEN blow up if appropriate.