Many eBay sellers feel the same way and are looking to grow off eBay. As the cliche goes, don't put all your eggs in one basket.
> I feel that is really outrageous for what
> my needs are. Any suggestions?
If you want free, osCommerce: Chain Reaction Edition with the Paypal Website Payment Pro module is probably your least expensive solution.
I think the price range quoted for you is reasonable depending on your specific needs are. Have you put together a list of your business and technical requirements?
Are you managing your eBay listings with an auction desktop program or web service? They might offer some sort of off eBay solution. Many auction programs and web services offer off eBay store.
What is your plan for managing inventory for eBay and your web store? What payment terms will you accept? Do you have a merchant account now and/or Paypal?
How do your process orders currently in terms of receiving sales details, payment confirmation, and shipping of the product? Would that change with the inclusion of a web store?