My 98 Mazda 626 LX (manual, 112K miles) has been at the mechanics for
the past 2 days. It started off as a problem with an exhaust pipe at
the front. I have also had a catalytic converter code for a few
thousand miles and it needed to be replaced. He is charging me about
$900 + tax for these items ($420 parts, $480 labor). Seems a bit steep
to me. In addition, he found a misfire on cylinder 2 and traced it to
a leaky gasket. He says it needs to be fixed. Further, he says, if it
is not fixed, the following could happen:

1). The fuel mixtures will go out of balance with the result that this
cylinder could run lean while the other 3 could run rich. This might
result in hot spots in the engine

2). It could affect the newly replaced catalytic converter, shortening
it's life

3). Summer is here, the gasket could fail altogether.

4). For the $20 part, it will take him 3.5 hrs of labor at $80 an
hour.

My questions are:

1). In the first place, is $900 a bit too steep for parts + labor for
a new cat + exhaust pipes?

2). Am I being had about this whole cylinder misfire? Do I need to get
it fixed immediately? What are the consequences if I do not?

3). I suspect I am being charged a lot for labor Does this really take
3.5 hrs?

Any advice on these questions is appreciated. Thanks in advance!

Cheers,
Satya