Bronx,
Of course it's astonomical. But not much of that is due to instructors' pay, a point you conveniently ignored. You don't have something like 80% tax on fuel in the US. You don't have VAT on everything in the US, or not at UK rates anyway. You don't have landing fees in the US. These account for most of the costs.
£30-40 a week most definitely does not equate to the amount you suggest. You can only fly one hour in two anyway, on average; briefings for most exercises are 30-40 minutes. Instructors drag helicopters in and out of hangars, preflight everything, answer the phone etc, answer groundschool questions - all unpaid. Four hours is about the maximum flying you can do in a day, except possibly during the very long days of mid-summer, if you happen to work at an airfield that's open all hours. That's not even allowing for days you can't fly due to the weather. That means we're talking about £1000 a week as an absolute maximum for a six day week. That would only be during a heatwave in mid-summer at a school that's fully booked. I don't know, but I think half that is probably more realistic, as an average over the year. That's £20,000-25,000 a year at most. Not an absolute fortune really.
What you say about hour builders ought to be true. But my experience of f/w ones is that they resent the low pay, can't wait to escape, and take it out on students by cutting corners. Not all, but many. Some even think that this is justified - read various recent threads on the instructors forum. Yes, of course it depends on the person. But it's nice to have the occasional full time instructor who wants to be there and can actually afford to stay.
I agree that it's unsurprising that so many Brits train in the US. But as I've pointed out, even paying instructors half what they get now wouldn't alter that. You ignored that bit; why the focus on instructors' pay? Jealousy?