back in '06 when my 13 yr old miniature shepherd mix was hit by a car, and left in the ditch for who knows how long, the vet asked me if I wanted Belle on the table, or in my lap for her euthanasia shot. She'd had a broken back, so I left her on the table, but I was able to cuddle her in her final moments.
There was no extra fee anywhere, no sedatives, and it only cost us for the amount of medication used for a 45 lb dog. He was a country vet, and she'd been his patient for her whole life.
I'm really sorry that you are going through this tough time, and facing this decision. I would have to agree that things seem pretty shady, and I would be taking my dog to a different vet.