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Yes more a/c time adds to the cost in the short term, but will save on re-test fees. I can't help thinking that some schools maximise sim time not only to be able to advertise a lower cost IR, but also to maximise their profits as the sims are are darn site cheaper to run and easier to make a profit on then a/c. This is not the best option for the student.
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I must be missing something here. The schools offer the maximum allowed in the sim because that is the cheapest option for the student. It would, without doubt, be much better to do more hours in the aircraft. I would imagine most schools (and certainly the one I work for) would be glad to oblige any student who wishes to do less hours in the sim and more in the aircraft. The student only has to express that preference, and of course be ready to pay for it.
Personally, I would advise any student who can afford it to do the whole course in the aircraft. The difference (in our school) would be a mere £9,200!
Nasib