That seems pretty steep for just the confined water sessions. I know of a very good course (albeit in California, so that doesn't help you out at all) that is probably right around that $550 mark that turns out absolutely fantastic divers (who have never been on their knees, have good buoyancy by the time they're certified, no hand sculling, no danglies....can't say enough good things about them).
While I agree with Blackwood's comment above that most of the learning happens in the confined water sessions, that's a lot of money to spend on just those few hours....assuming it's like a typical OW class where you end up spending siginficantly less time than on should.
I'd do a little research, find a reputable shop that gets good reviews from local divers, and talk with them....see what they'll offer and if they're willing to work with you.
Here's the rub: when it comes time to sign off the PIC card certifying that the student is qualified, it is the local instructor that has to do it. Not PADI, not the resort; the instructor who, at most, did the pool work. That's a lot of risk considering that the instructor didn't even teach the class.
Richard
FWIW, the instructor who conducted your final OW dive is the certifiying instructor....not the instructor who did your confined water or classroom sessions. In other words, if you had done the classroom work, the confined water dives, and three of the four open water dives with one instructor, and then did your final open water dive with a different instructor, the second instructor would have to be the one to sign off on you and would be the certifying instructor.
I know this because I have an SSI OW cert even though I started out as PADI....because the dive op I did my check-out dives with lied and said they were PADI, when they were actually not current. The local instructor and PADI both explained to me that since he did not conduct my last OW dive, he could not certify me....
I'm with you, though, I probably would not accept a referral....or at the very least, I'd still make sure that the student knew his theoretical stuff and could show me skills in the pool before I considered taking him/her out to the open water.