ok, I'll try to answer your questions in order. First, however, we have to define what it is exactly that you are getting bids on (imprecise description would account for the vast difference in pricing). First, what is it exactly that your body shop friend is doing? Is he merely straightening panels, fixing rust, and smoothing? leaving the body work "in the raw"? Is her priming over anything? If so, what kind of primer and how many coats? What about a sealer? See, one place might think you are handing them a car that only requires basecoat/clear coat and another might be thinking they will get the car with an epoxy primer and a sealer coat, leaving it to them to shoot 3 coats or so of primer/surfacer, then block sand, before shooting the base coat clear coat. These two approaches are separated by a vast gulf of time and materials. Thus, I suspect the difference in the prices are due to different perceptions of each source as to the work you are asking them to do. Remember, the single greatest contribution to the success or failure of a paint job is the preparation before hand. The difference between a good paint job and a great paint job could be in a couple extra applications of primer sealer, guide coat, and block sanding twice or three times, instead of once or not at all.
The body shop that rented me their spray booth said that they would be charging a minimum of $5,000 for the green pearl coat and clear coat, plus cut and rub, that I did. That's $5,000 without any block sanding or application of primer! Just 3 coats of base and 4 coats of clear! About 5 years ago I was given estimates of between $10,000 and $15,000 to paint my stang.
House of Kolor - ok this is a paint manufacturer that really became well known based on its candy colors - such as candy apple red, back in the day of exotic paint jobs, flames, etc., on hot rods. House of Kolor is thought of as more of the exotic show car type paints - pearls, candies, etc. Mostly custom work.
For paint jobs that are designed to replicate the factory appearance, or to even step up a notch or two in terms of effects (pearls, flip-flops), the standard paints used are PPG, DuPont, Sikkens, and Spees-Hoecker. These are your top of the line mass production paints. Bump shops that do a lot of insurance work might use Sherwin Williams, Nacin or some other regionally made paint. The advantage of PPG, et al., is that they have great tech support and you can pretty much match your paint anywhere in the country if you have to affect a repair down the road. I am paying around $280 a gallon for my base coat, $175 a gallon for clear, around $150 a gallon for the primers, plus about the same amount again for reducers and hardeners. Primer/base coat/clear coat and misc. materials ran me around $1,700, using PPG products.
Just a few thoughts to get you started.
good luck.
As for the cut and rub - I spent about 60 hours or more doing that alone. Now if that was a shop charging $45 an hour, that would be $2,700 just for that!