about the batteries, if they are only 1.2KWH packs, 800$ for a refurbished one ($300 labor, $500 for the batteries) sounds about right.
50 cents a watt hour or so. perhaps a little expensive, considering you can buy D cell ni-mh for 70 cents a watt hour off amazon
I would not pay 500$ for a used battery.
Back when I was studying the Prius packs lithium was the big buzz and already had a bit of a track record with laptops and such, and prices were falling fast. I figured both nimh and lithium required special charging routines and the lithium easily packed in more energy... that's why I skipped on the nimh.
Woody's used pack was around 60¢/Wh and came with a free ebike
The used pack on my Currie was around 39¢/Wh.
One thing to keep in mind would be the shelf life compared to cycle life. I'm pretty sure nimh would lose to lithium in cycle life but most likely trounce lithium when it comes to shelf life.
On the Prius packs you'll see many folks voicing caution about how long a used pack has been "sitting" on the shelf or out of the car.
I'm not sure if that's because the controls in the pack keep draining the cells or if the particular chemistry of the Prius' battery has a high self discharge rate.