Were my ears burning?

Ridding the walls of rust and preventing it's spread/ reoccurrence is a good and wholesome thing. I'm not a car guy, so can't compare the products I would certainly use wall foam to protect the liner, UNLESS you have a high water table!

If they are charging ~ $1200 - you must have some large areas that need, not just the skimcoat, but the full 2" applied. I'm starting to suspect ground water issues in your backyard.

While it's far preferable to have the extra cord on the light - it's in no way necessary! The reason for the extra cord is to be able to change the bulb/ replace a leaky gasket - you can always disconnect the wires at the junction box and secure a fishtape to the wires to allow you to get it up out of the water to fix any problems, then pull the cord back through and reconnect the wires. (we're talking 5 extra minutes to do it that way)

I hope this helps answer your questions - if i haven't been clear enough or you have more questions for me, feel free to ask.