I agree, Sal.
The test costs shouldn't make a difference. I feel £150 is reasonable as long as you receive a decent amount of feedback from your tests.
People are throwing £32.5K around - you are borrowing £55.75K, and if things go wrong (touch wood you won't have to worry about this!), that's what you (or your parents?) will be liable for.
Whilst I see monkeyboys point that it's only four pilots to fit into an airline - the sponsorship agreement is purely that. An employment offer is subject to flybe's requirements (read the "Repayment of Training Costs" section carefully). It makes sense that they are predicting that demand, but it isn't contractually a part of the sponsorship agreement.
It is a lot of £££. It's not only they who are choosing you, you should be choosing the airline you feel offer the best opportunities for you - as you are paying for it. Good luck all who go for it.