As someone who own his a retail business (not cycling) I would just shut my mouth and accept any business that walks through my door. Although you did not buy all parts from the lbs you were willing to spend a decent chunk of change and were paying for the build. Brick and mortar stores need to adapt and capitalize on all business that comes there way.
Option #2 for the LBS was to get zero dollars at retail instead of $600 in parts and $100 in labor.
Some folks are just plain stupid.