I really don't think $1,000 stud fee is out of line either. There is
also the option of breeding your mare as a lease and then getting a free
breeding as part of that agreement. Then of course, your mare is not able to
compete in endurance for a couple of years.
The $1,000 stud fee is really small compared with what it takes to care for
any horse, whether it's free or not. There's an article in this month's Western
Horseman or Horse & Rider (can't remember which) which talks about the joys
of raising your own performance horses, rather than going out and buying them.
Obviously it is much cheaper to go out and buy an already "trained" gelding for
$1,500 or so, but you still have to put in the hours and possibly undo some
training, so in essence, whether you breed or buy, it's still a crapshoot, but
what a wonderful one!