To me, the key is right here:
"My hunch is that the people who quoted much lower estimates and timeframes were shooting for the development work."
Firms/individuals/groups that quote dirt cheap prices are probably either a) desperate for the work (which makes ya wonder why) and/or b) not caring about the work they do at all (therefore producing a sub par final product).
A big mission of my new startup matchist (http://matchist.com/talent) is to filter out these clients for freelance developers, so they only deal with those who aren't looking for 30 lbs in 30 days.
We're not 100% there yet but we're working damn hard at it.