Well that changes things a little bit, but as I actually went through the process of building a similar axle myself I can break down some of the costs for you.
Rear Dana 60: $50-150
Custom shafts to use Torino/New Style 9" axle bearings: $400-600
Housing Ends: $95
http://www.moserengineering.com/other-parts/housing-ends/big-ford-new-style-torino.html
Having CrawlerTech use a true bar to weld the housing ends on true/straight with the housing: $150
Explorer Disc Brake setup from a junkyard: $50 (figure more money for new pads, rotors, and calipers)
Then add in the cost of an install kit, gears, and your locker of choice.
It can quickly add up to at least the 1200$ he is asking, even more if you go with a selectable locker. If you can't install the gears yourself figure in more money for that. That's also not including the price of shock mounts and spring perches.
When I started looking into the cost of putting my rear axle together I decided it wasn't worth the money to me. I was going to make it 5x5.5 and was working on also narrowing a front HP Dana 44 to use TJ Rubicon inner shafts and Ford Knuckles/outers. It would have been a slick combo but too much work and money just to run 35's.