I would think about 400 is the most I would be willing to pay for a lift install. It really should only take 5 hours unless something goes wrong of course.
I would certainly replace the shocks at this point - due to the mileage and to the reaction of the vehicle going over bumps. Don't worry about getting OEM, but don't get a budget set either. Get a good mid-level set that has been well reviewed and you'll be fine.