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You just dont acept it do you. Theres no paperwork costs, its a one off fee to the examiner, typically £100 - £200. Theres no CAA fee. The only addition is aircraft/sim hire.
If your going to scrape the barrell by trying to add petrol/travelling costs etc then your getting a bit desperate. £20 or £30 quid for fuel and 2 or 3 nights b&b at £25 quid a night hardly adds major costs, does it? A saturday night out on the beer costs more!
I am not saying its cheap, as you suggest. I am merely pointing out that your initial estimates of 3 and a half grand are grossly exaggerated.