Well, seeing as it's a chrono movement, and the watch is from a discontinued line, they are probably asking more in any case. If there's water damage they can use that to blame anything, no one but a skilled watch repairer would know any better. Most people probably don't even know that a movement is oiled, or that movements aren't dry to begin with.
Didn't someone (like Kruzer?) have a genuine AP which had water damage due to poor QC and he got hit with thousands in repair bills?
Good news from this story is The Zigmeister managed to fix the watch