Just got word from the Audi Dealer that my left front brake pad tore loose from the metal backing plate. It badly scored the rotor, so new pads and rotors up front. Then they said that the Caliper was not retracting and they are going to replace it altogether.

Total cost will be about a Grand. Does this seem reasonable to you guys?

 

Nope. You could buy a used caliper (I have a couple...), new rotors and pads for front and rear, install yourself, and still have money left over. Changing brakes is very simple and can be done easily in a couple of hours. You could also buy a caliper rebuild kit and repair your existing caliper; but, it's most likely a stuck piston and it may be damaged, so it's probably more worthwhile to just buy a used caliper.