This is about a common modification. Thus a repair shop should be in state to give a fixed prize for a common lens to be modified. As the OP hinted at, that was the case with Leitz/Leica themselves.
In case the lens in question shows issues, one still can inform the customer and ask whether he wanted that to be solved too. In case the customer in such case cancells the whole thing one still may claim the expenses, as by sending in for a fixed price modification the customer has made a contract.
If one has made bad experience with customers in such cases, one may ask for such expenses billing. BUT should explain the reason behind that in a sentence or two. More so as in this case the OP has explicetely inquired on Paepke's expense billing policy, and got no reply that made sense, resp. none at all.
Also one may offer that such expense-billing is cancelled in case modification was without further issues or deduced from a bill on repairs (as the inspection efforts then are part of the repair anyway).